Fierce competition has driven up the number of landlords demanding rent up front as tenants battle for homes.
The share of landlords insisting tenants cough up two or more months’ rent before moving in has increased 43pc since the pandemic started. An extreme shortage of homes has meant landlords chose the wealthiest renters.
This was a jump of nearly a quarter in only five weeks since the end of 2021, according to exclusive data from Goodlord, a referencing service.
In London, the proportion of landlords demanding two months’ rent up front has risen 143pc since 2019, the largest in the country. Rents in the capital have also soared by 10.3pc, according to property website Zoopla, as demand spiked due to workers returning to the office.
The reasons behind the shift are three-pronged. Landlords have been scarred by a loss of rental income during the pandemic and long delays evicting tenants due to a backlog in the courts. They have become wary of taking on tenants who are not financially secure.
Second, many tenants, particularly those who are self-employed, have had their credit ratings adversely affected by the pandemic fallout. Buy-to-let investors often ask for multiple months’ rent up front when applicants do not meet affordability criteria.
Meanwhile, rental supply has fallen by 39pc, compared to the five-year average, according to Zoopla. Tenant demand has jumped 76pc, which has meant landlords call the shots.
Dan Wilson Craw, of Generation Rent, a tenant campaign group, warned the rise would lock Britain’s most vulnerable tenants out of the rental market.
“Because people who are on a low income or benefits usually don’t have the savings needed to pay this, they simply don’t get the home,” said Mr Wilson Craw.
“People are particularly vulnerable to this if they don’t have well-off relatives who could guarantee the rent. Many will end up in unsafe properties as a result.”
Osama Bhutta, of homelessness charity Shelter, said: “For people on lower incomes who can’t save the big lump sums this could be the difference between finding somewhere to live and homelessness.”
The largest share of landlords asking for two or more months’ rent upfront was in the East Midlands, at 3.13pc.