A significant proportion of letting agents remain unclear on new limits to rent in advance as the Renters’ Rights Act comes into force on 1 May, it hsa been revealed.

The findings from The Letting Partnership suggested that many agents are still requesting or accepting more than one month’s rent upfront.

It surveyed 887 letting agents and found 41% were unaware they were prohibited from accepting rent before a tenancy agreement is signed by all parties.

A further 36% did not know that clauses requiring more than one month’s rent in advance will become unenforceable.

At the same time, 38% of agents also admitted they requested or accepted more than one month’s rent in advance, either regularly – at 20% – or occasionally, at 18%.

Voluntary exception

The Letting Partnership says the rules do not prevent tenants from voluntarily offering rent in advance, but landlords and agents cannot require or request it.

It adds that existing agreements entered into before 1st May are expected to remain enforceable, meaning some arrangements may continue in the short term.

Agents reported that rent in advance was most commonly used for tenants with poor credit history, at 37%, international tenants – at 24% and those without a guarantor, at 18%.

When asked how ready they were for the changes, 44% said they were only fairly prepared or worse, with 33% fairly prepared, 9% not very prepared, and 2% not at all prepared.

A significant proportion of agents are still not fully across the details.”

The Letting Partnership’s COO, Chris Mason (pictured), says: “What these findings show is that while the industry is aware that change is coming, a significant proportion of agents are still not fully across the details of how these rules will operate in practice.”

He adds: “As rent in advance is effectively removed as a risk management tool, agents will need to rethink. Affordability checks and guarantor requirements will need to adapt, but so will the underlying client accounting processes. Ensuring rent is collected, recorded and handled correctly under the new framework is essential.”