For many landlords, upfront rent has long been a simple way to manage risk.
Asking for several months’ rent at the start of a tenancy offers reassurance, particularly where income is uncertain or a tenant’s history is limited. It is a straightforward solution, but not always a complete one.
For landlords in England letting assured periodic tenancies in the private rented sector, that approach is now changing. New rules on rent in advance under the Renters’ Rights Act 2025 will apply to tenancies starting on 1 May 2026, requiring a more considered approach to protecting rental income.
At Martin & Co, we are helping landlords move away from reliance on large initial payments and towards stronger checks, clearer safeguards and better long-term planning.
Related: Letting compliance: Renters’ Rights Act guidance
Why upfront rent was only ever a partial safeguard
Large initial payments can reduce short-term risk, but they do not remove it.
Once that early period has passed, landlords remain dependent on the tenant’s ability to pay rent consistently. If that changes, the initial payment offers little protection beyond the first few months.
In some cases, higher upfront rent has been used to offset uncertainty instead of properly assessing it.
The focus now shifts to what matters most: selecting tenants who can sustain the tenancy over time.
Moving towards more effective pre-tenancy checks
With large upfront payments no longer a fallback, the quality of pre-tenancy assessment becomes more important.
A strong referencing process should provide a clear, evidence-based view of an applicant’s financial position. This includes:
- Verifying income through documented proof
- Assessing affordability against realistic benchmarks
- Reviewing credit history in context
- Understanding employment stability and prospects
This level of insight helps identify potential risks before the tenancy begins and supports more confident, informed decision-making.
It also provides the foundation for any additional safeguards.
Using guarantors as a structured safety net
Where referencing highlights some uncertainty, a guarantor can provide an added layer of protection.
A well-drafted guarantor agreement creates a legal obligation for a third party to meet rental payments if required. This can strengthen an application where a tenant is otherwise suitable but presents some risk.
Consistency remains essential.
Landlords should avoid making ad hoc decisions about when to request a guarantor. Instead, a clear policy should be in place, for example:
- Defining when a guarantor is required
- Setting minimum financial criteria
- Applying the same standards across all applicants
A consistent approach reduces ambiguity and supports fair, defensible decisions.
For some landlords, this will be sufficient. Others may choose to add further financial safeguards.
Related: What the Renters’ Rights Act means for self-managing landlords post 27 December 2025
Where rent protection fits into your strategy
Rent protection products are increasingly becoming part of a modern landlord’s toolkit.
These products can offer:
- Cover for missed rental payments
- Support with legal processes, depending on the policy
- Greater certainty over monthly income
While they should never replace proper referencing, they can provide an additional layer of security, particularly in a more regulated environment.
Used alongside strong tenant selection, they help support a more predictable income stream.
Why affordability now takes centre stage
Across all these measures, one factor underpins them all: affordability.
Without the option of large initial payments, landlords need confidence that tenants can sustain the rent over time.
This means:
- Setting clear and realistic income thresholds
- Verifying income rather than relying on assumptions
- Taking a cautious approach where income is irregular
A tenant who can comfortably afford the rent is far more likely to maintain payments, remain in the property for longer and reduce the risk of arrears.
Combining measures for stronger protection
No single measure replaces rent in advance on its own. The most effective approach is layered.
A well-considered risk strategy typically includes:
- Thorough referencing and affordability checks
- A guarantor, where appropriate
- Rent protection as an additional safeguard
Together, these elements provide ongoing protection throughout the tenancy, rather than relying on a one-off payment at the start.
This creates a more balanced and dependable approach to managing risk.
Related: Ending a Tenancy After May 2026: Renters’ Rights Act Possession Grounds for Landlords
A more resilient way to manage tenancies
The shift away from upfront rent is not a loss of control. It is a move towards better control.
By focusing on tenant quality, financial sustainability and consistent processes, landlords can reduce reliance on short-term fixes and build a more stable rental income.
Over time, this leads to fewer issues, longer tenancies and more predictable returns.
Strengthening your approach ahead of the changes
Adapting to the new framework is not about removing safeguards. It is about improving them.
With the right checks, safeguards and processes in place, landlords can move forward with greater confidence.
If you would like support reviewing your referencing approach, setting clear affordability criteria or exploring rent protection options, your local Martin & Co team is here to help.
