A survey by the Deposit Protection Service has shown that six out of every 10 tenant respondents who have moved within the last year said they paid between two and three months’ rent upfront to secure their property.
The survey of 2,210 renters also revealed that 8% had paid between four and six months’ rent upfront with 5% saying they’d paid between nine and 12.
Managing director Matt Trevett says: “Significant proportions of prospective tenants are providing rent upfront to landlords or letting agents. Tenants paying rents upfront should ask their landlords what impact this will have on their rental payments: typically a landlord or letting agent who asks this does not charge for the equivalent amount towards the end of the tenancy, but tenants should always double check this is the case.
“Landlord and lettings agents should make it clear that tenants’ deposits, protected with independent third-party deposit scheme such as the DPS, are separate.”
Kate Watts, of Robert Watts estate agents, in Bradford, lets homes on behalf of 950 landlords in the area.
She adds: ”We don’t ask for rents upfront outside of deposits, but I can see how asking for additional rents would be a way for agents to differentiate between prospective tenants. The sheer demand for rental properties since the pandemic means that we see an average of twenty to thirty initial renters chasing one property.
“Desperate renters will pay upfront rent, but tenants who do this should be aware they could struggle to afford rents later in the tenancy if they have no savings to cover unexpected bills or general cost-of-living increases.”
The survey also revealed that, to differentiate themselves from other prospective tenants, almost one in four (23%) of respondents provided evidence of their income.
In addition:
16% had provided references from a previous employer;
15% had provided a testimonial from a previous landlord;
13% had shared details of their rental history;
9% had offered details about a guarantor;
4% had provided biographical information;
2% had provided pictures of their current property;
1% had provided images of themselves, family members, or pets.
The survey revealed that 32% of respondents moved either within the last six or 12 months.