Fraudulent tenancy applications could expose the UK’s private rented sector to £4.1bn in direct financial losses annually, according to analysis of more than one million tenant references conducted by Goodlord.
The referencing platform found 41 applications per 1,000 references were flagged for suspected fraud between July 2025 and June 2026. While this represents a decline from a peak of 46.6 per 1,000 in late 2024, suspected fraud levels remain significantly above historic averages. Calendar-year data shows suspected fraud incidents increased by almost 40% in 2025 compared with 2024.
Financial exposure per fraudulent tenancy
Goodlord estimated the average direct financial exposure from a fraudulent tenancy at £9,601, incorporating costs such as rent arrears, legal and court fees, bailiff fees, void periods and property damage. The £4.1bn sector-wide figure was calculated by applying the observed fraud rate to an estimated 5.3 million privately rented households in the UK, assuming an average of two tenant references per household.
Regional variations in fraud rates
Analysis of confirmed fraud cases revealed significant regional disparities. London recorded a fraud rate almost twice the national average and the highest of any UK region. The West Midlands had the second-highest confirmed fraud rate, followed by the North West and applications from overseas.
Fraud rates were particularly elevated among high-value rental properties. Homes costing more than £10,000 per month recorded rates approaching 18 per 1,000 applications, between three and six times the level observed across average rental properties.
Evolving fraud tactics
Looking specifically at confirmed fraud during 2025, fake employment references were the fastest-growing category, increasing 226.6% year-on-year. Referee fraud rose 146.4% and identity manipulation increased 140.4%. While every major fraud category has declined slightly in 2026 to date, fake references, bogus referees and forged payslips remain above 2024 levels.
Nishma Parekh, director of referencing at Goodlord, said: “Rental fraud isn’t new or hypothetical: we’ve seen fraudsters operating first-hand. But what’s changing is how sophisticated fraud has become. Fraudsters are no longer relying on a single forged payslip – they’re building entire fake identities, combined with false employers and invented referees.”
She added: “The industry needs to move from spotting one red flag to identifying patterns across the referencing journey – and to consistently review those checks, as fraud tactics evolve.”
Industry response
Chris Norris, chief policy officer at the National Residential Landlords Association, said the findings should act as a wake-up call to landlords. “Although due to the use of advanced AI models it has never been easier to generate fraudulent documents, landlords must ensure their referencing checks evolve to respond to fast-moving technological developments,” he said.
“In practice this means undertaking regular reviews of the systems they use to assess applications to reduce the chance of becoming a victim of fraud.”
The findings come as regulatory scrutiny of letting practices intensifies, with landlords and letting agents facing increased compliance requirements. The scale of potential losses from tenancy fraud adds another layer of financial risk to a sector already navigating regulatory changes and market pressures.
