No, the £2,500 isn't for a rental deposit and he won't itemise it. I've repeatedly asked him exactly what the £2,500 represents and he won't give me a breakdown. In fact, he has actually said he wants the money purely out of spite because apparently I am spiteful.
There are things he has contributed towards in the house, but nothing that explains £2,500. When I moved in, his mum gave him £1,000 specifically to spend on my house. From that, around £350 went on kitchen units, roughly £100 on a worktop and £100 on a sink. His dad and brother fitted the kitchen for free. He also did some work/tiling in my bathroom, but I paid for the tiles myself. I also had to buy additional kitchen units because some of the ones he'd sourced were rotten.
This also completely ignores the other side of the equation. He pays no rent and no regular share of household bills. My household bills are nearly £2k a month before you even start adding all the costs associated with raising our two children. He works cash in hand. He recently gave me £300 towards the children, then following an argument the next day demanded/took the money back while simultaneously claiming that he'd "contributed" to the household.
There's another reason I'm suspicious about his sudden financial claims too. Since around July he's become absolutely determined to refit my bathroom. He's been collecting random bathroom items and repeatedly insisting that he wants to rip out and reinstall it, despite me not asking him to do this.
At one point he actually said if I let him fit the bathroom, he will leave, and has repeatedly said words to the effect of "the faster I do the bathroom, the faster I'll leave." That has made me extremely uncomfortable. If you're supposedly preparing to leave someone's house, why is carrying out another substantial improvement to their property somehow a condition of you leaving?
Especially when he is now pointing towards things he's previously contributed to as justification for demanding money from me. It makes me very reluctant to allow him to put another penny or hour of work into the property because I worry it'll simply become another thing he claims I owe him for.
So no, I don't believe this £2,500 is genuinely about recovering money he's spent. He won't itemise it, the figures I actually know about don't come remotely close to explaining it and, most importantly, he has told me himself that he's demanding it out of spite.
As for whether he can afford to rent privately or where he goes afterwards, I'm finally realising I need to stop treating that as my responsibility to solve. He's an adult. He managed to live elsewhere for months before coming back to London, and I never agreed to him moving back into my house. His housing situation cannot mean that I'm required to continue housing him indefinitely against my wishes. @Dumbledore167