For many landlords, upfront rent has been a familiar way to manage uncertainty.
When income was less predictable or credit history limited, asking for several months’ rent in advance as a requirement often felt like a straightforward way to reduce risk. However, the rules around rent in advance are changing, and with them, how landlords approach risk at the start of a tenancy.
For landlords in England letting assured periodic tenancies in the private rented sector, new restrictions under the Renters’ Rights Act 2025 will apply to tenancies starting on 1 May 2026. Landlords cannot ask for or accept rent before a tenancy agreement is signed. After signing, they can request no more than one month’s rent in advance, or up to 28 days where the rental period is shorter.
With these limits in place, the focus shifts towards more effective ways to assess and manage risk.
At CJ Hole, we are working with landlords to ensure the right safeguards are in place, not just at move-in, but throughout the tenancy.
Related: Letting compliance: guidance for landlords
Why the shift away from upfront rent matters
Upfront rent has often been used as a quick solution to uncertainty. In reality, it has always been a short-term measure.
Once the initial payment period has passed, landlords remain dependent on the tenant’s ability to pay rent consistently. If circumstances change, that early reassurance offers little long-term protection.
The new rules remove the option of requiring large upfront payments and instead encourage a more reliable way of managing risk through proper assessment before the tenancy begins.
Stronger referencing as the starting point
With less reliance on upfront payments, the quality of tenant referencing becomes more important than ever.
A thorough referencing process should provide a clear and realistic picture of an applicant’s financial position. This includes:
- Confirming income through documented evidence
- Assessing affordability against appropriate thresholds
- Reviewing credit history in context
- Understanding employment stability
This is not about excluding tenants unnecessarily. It is about making informed decisions based on evidence.
Done well, referencing reduces the likelihood of issues later and supports a more stable tenancy from the outset.
Guarantors as a flexible support option
Where referencing highlights some uncertainty, a guarantor can provide a practical next step.
A guarantor agrees to meet the tenant’s rental obligations if they are unable to do so, offering an additional layer of financial security. This can be particularly useful where a tenant is otherwise suitable but presents some financial uncertainty.
Consistency is essential. Clear criteria should be set in advance, including affordability expectations for the guarantor.
Used correctly, guarantors allow landlords to accept a wider range of applicants while maintaining confidence in the tenancy.
Rent protection as an additional safeguard
Alongside referencing and guarantors, many landlords are turning to rent protection products as part of a broader strategy.
These products are designed to support landlords if rent payments are missed, depending on the policy terms, helping to maintain income during periods of uncertainty. Some policies may also include legal support if possession becomes necessary.
While not a substitute for careful tenant selection, rent protection can provide an additional layer of reassurance in a more regulated environment.
Affordability checks now carry greater weight
Across all of these measures, affordability plays a central role.
With restrictions on rent in advance, landlords need to be confident that tenants can comfortably sustain the rent over time.
This involves:
- Setting clear and realistic affordability thresholds
- Verifying income rather than relying on estimates
- Taking a considered approach where income is irregular
A tenant who can genuinely afford the rent is far more likely to pay consistently and remain in the property for longer.
A combined approach to managing risk
No single measure replaces the role that upfront rent once played. The most effective solution is to combine multiple safeguards.
A balanced strategy may include:
- Detailed referencing and affordability checks
- A guarantor, where appropriate
- Rent protection for additional security
Together, these elements provide ongoing protection throughout the tenancy, rather than relying on a one-off payment at the beginning.
A more structured and predictable lettings process
The changes introduced by the Renters’ Rights Act 2025 reflect a broader shift towards greater transparency and fairness in the rental market.
For landlords, this means moving away from reactive decisions and towards a more consistent and structured process.
By focusing on tenant quality, affordability and clear safeguards, landlords can maintain confidence without relying on large upfront payments.
Getting prepared for the changes
Adapting to these changes is not about removing protection. It is about strengthening how that protection is applied.
By reviewing your referencing process, setting clear affordability criteria and considering safeguards such as guarantors or rent protection, you can build a more resilient lettings strategy.
If you would like guidance on preparing for these changes or reviewing your current approach, your local CJ Hole team is here to help.
