Nearly two thirds of all rental property applicants in London are from overseas, Foxton’s internal data has revealed.

The jaw-dropping figures are found in a joint statement by the company and alternative deposits supplier Zero Deposit – with which it has signed a new partnership.

It points to agents across the capital face a growing mass of applicants who may not have established British-based financial references or access to a traditional guarantor.

The figures also suggest that the capital’s high rents are a consequence of the huge demand that so many overseas rental property applicants create within the capital.

Guarantor solutions

Zero Deposit says it is driving strong demand for guarantor solutions like its service, and suggests it is also pushing up rents, which are now 50% higher than the rest of Britain at £2,294 per tenancy on average.

In response to this demand, Foxtons has partnered with Zero Deposit to make Guarantor+ available to its tenants, providing an additional route for applicants who may otherwise not meet traditional guarantor requirements in a highly competitive rental market.

To date, more than 25% of total available properties across letting agents and Build To Rent operators are available with Guarantor+.

“London is unlike any other rental market in the UK. Rents are significantly higher than the national average, competition for homes is intense, and a large proportion of tenants are relocating from overseas,” says Sam Reynolds, Chief Executive of Zero Deposit.

“In that environment, it is increasingly common for renters to be financially capable of affording a property, but unable to provide a traditional UK-based guarantor. That can create unnecessary friction at the point of application, even when demand for housing is strong.

“We are seeing this reflected in adoption patterns, with over 77% of tenants in London selecting our product, Guarantor+, when given the option. It highlights just how pronounced these pressures are in the capital.

“As the rental market continues to evolve, particularly in cities with high levels of international mobility, guarantor products such as ours are playing an important role in helping tenants secure homes quickly while still giving landlords and agents the protection they need.”

Referencing criteria

Gareth Atkins, Foxtons Managing Director of Lettings at Foxtons, says: “London remains one of the most competitive rental markets in the country, but the diversity of today’s tenant base means the ability to connect landlords with a broader pool of suitable tenants quickly and efficiently has become increasingly important.

“Many prospective tenants who can comfortably afford their rent may not meet traditional referencing criteria. This is particularly common among international renters, students and the self-employed – groups that make up an important part of London’s rental market.”