Tenants will fail standard rental affordability checks in 47.6% of local authority districts, says Zero Deposit’s Sam Reynolds.
2nd Jun 20260 17,731 1 minute read Simon Cairnes
Almost half of England’s local authority areas could see average tenants fail standard rental affordability checks following the introduction of the Renters’ Rights Act, according to new analysis from Zero Deposit.
Its research examined average rents and earnings in England using the commonly used affordability benchmark that tenants should earn at least 2.5 times their annual rent.
Based on average monthly rents of £1,438, tenants would need an annual income of £43,140 to pass affordability checks. However, average earnings in England are currently £41,859, leaving renters £1,281 short of the required level, the analysis found.
Tenants are already likely to require a guarantor in 19.8% of England’s 288 local authority districts, according to Zero Deposit, because average earnings fall below affordability requirements.
Significant riseThe company argues this could rise significantly if landlords and agents increase affordability thresholds from 2.5 times annual rent to three times annual rent in response to the Renters’ Rights Act. Under that scenario, tenants would fail affordability checks in 47.6% of local authority areas.
Sam Reynolds (pictured), CEO of Zero Deposit, says: “While the Renters’ Rights Act is designed to improve security for tenants, it also significantly changes the way landlords manage financial risk within the private rental sector.
We expect guarantors to become an increasingly common requirement for renters.”
“With restrictions on upfront rent payments and fewer traditional safeguards available, landlords and agents naturally place greater emphasis on affordability checks and income protection when assessing prospective tenants.
“As a result, we expect guarantors to become an increasingly common requirement for renters who fall outside standard affordability criteria, particularly younger tenants, overseas applicants, self-employed workers, and those moving to high-cost rental areas.”
Tagsdeposit replacement rent guarantee schemes renters' rights act zero deposit 2nd Jun 20260 17,731 1 minute read Simon Cairnes Share Facebook X LinkedIn Share via Email