Nearly 70% of landlords intend to implement more rigorous tenant vetting procedures ahead of the Renters’ Rights Act coming into force on 1st May, according to new research.
A survey of 500 landlords by Paragon Bank found that 69% will introduce more in-depth checks for prospective tenants to reduce the risk of requiring evictions later. The changes come as key provisions of the Act take effect, including the abolition of Section 21 ‘no fault’ evictions.
Court delays prompt concerns
While three quarters of landlords reported feeling prepared for the legislation, 42% identified the end of Section 21 evictions as having the greatest impact on their business operations. A further 43% expressed concern about the risk of problem tenants due to rent arrears or anti-social behaviour.
The survey revealed that 65% of landlords are calling on the Government to implement faster court processes to minimise delays in the eviction process. Additionally, 39% stated that the number of mandatory grounds for possession needs to increase.
Financial implications
Just over one third of landlords (35%) expect the Act to impact them financially, whilst 53% indicated they will consider increasing rent. The findings suggest landlords are adjusting their business models in response to the regulatory changes, which could have implications for the rental market similar to recent shifts affecting first-time buyers.
Lisa Steele, Mortgage Lending Director at Paragon Bank, commented: “Given the pressures expected on the courts through the change to the eviction process, landlords are understandably planning to make more expansive checks on prospective tenants as they don’t want the cost and time involved in a lengthy eviction process.”
Steele noted that the stricter vetting could create challenges for those new to the rental market who have not yet built up a tenant reference history, as well as those with irregular income schedules. The changes occur amid broader concerns about housing market pressures.
The Renters’ Rights Act represents one of the most significant changes to the private rental sector in recent years, with landlords and letting agents now having less than one month to finalise preparations before implementation.
