Why Tenant Referencing Is Even More Important Post–Renters’ Rights Act

The Renters’ Rights Act has fundamentally changed the balance of responsibilities between landlords and tenants in England.

Since 1 May 2026, most private rented tenancies have moved to an assured periodic tenancy structure, while Section 21 ‘no-fault’ evictions have been abolished. Landlords now need to rely on specific legal grounds when seeking possession, and the process for dealing with rent arrears and other tenancy issues has become more structured.

For landlords, this makes one thing more important than ever: getting the tenant selection process right from the beginning. That means thorough, fair and compliant tenant referencing isn’t simply a box-ticking exercise. It is one of the most important risk-management tools available to a landlord.

The cost of getting it wrong has increased

Historically, landlords had Section 21 as a relatively straightforward route to regain possession of a property at the end of a tenancy, subject to the relevant requirements.

That safety net has now gone. If a tenancy becomes problematic, landlords must rely on the possession grounds available under the new rules. For example, where rent arrears are involved, the rules now place particular importance on the level of arrears and the circumstances surrounding them. This means the consequences of placing the wrong tenant in a property can be considerably greater. A tenant who repeatedly pays late, accumulates arrears or causes serious tenancy-management problems can create a much more significant financial and administrative burden for a landlord.

 Prevention is therefore becoming increasingly valuable. Referencing helps landlords make better decisions

Good tenant referencing provides landlords with information that can help them assess whether a prospective tenant is likely to meet their obligations.

Depending on the referencing process, this can include checks around:

• Identity
• Income and affordability
• Employment
• Previous rental history
• Credit history
• Previous landlord or agent references
• Right to rent

The objective isn’t to find a tenant with a ‘perfect’ financial history. It is to give the landlord a clearer picture of the applicant and identify potential risks before a tenancy begins. That distinction is important. A responsible referencing process should help landlords make informed and evidence-based decisions, rather than relying on gut instinct or first impressions. But referencing must be fair and compliant.  The Renters’ Rights Act doesn’t give landlords carte blanche to reject applicants simply because they don’t fit a preferred profile. In fact, the Act introduced important protections against rental discrimination. From 1 May 2026, landlords and agents cannot discriminate against prospective tenants because they have children or receive benefits. These restrictions also apply to people acting on a landlord’s behalf, including letting agents and referencing services. This makes the quality of the referencing process particularly important. Landlords need to assess applicants against consistent, objective criteria that are relevant to their ability to meet the tenancy obligations.

For example, a landlord should not simply reject an applicant because they receive Universal Credit. Instead, the focus should be on the applicant’s overall financial circumstances and whether the rent is affordable based on appropriate evidence.

In other words:

Better referencing doesn’t mean stricter referencing. It means smarter, fairer and more consistent referencing.

The importance of affordability

One of the biggest risks for landlords is rent arrears. Under the new system, landlords cannot simply rely on Section 21 if a tenancy goes wrong. While there are grounds for possession where rent isn’t paid, the process and thresholds matter. Government guidance states that where a tenant is in rent arrears, possession may be sought under the relevant ground, with the level of arrears being particularly important to the court’s decision. That makes affordability assessment an essential part of the pre-tenancy process. A robust affordability assessment can help identify situations where the proposed rent may be unrealistic for the applicant’s financial circumstances.

It can also highlight cases where additional information may be needed — for example, where income is variable, employment has recently changed or a guarantor may be appropriate.

 Referencing is also about evidence

There is another reason tenant referencing matters post-Renters’ Rights Act: documentation.

Good referencing creates an evidence trail showing that the landlord considered the application using an established and consistent process. This can be valuable when demonstrating that decisions were made fairly and without unlawful discrimination.

It also creates a clearer picture of the tenant’s circumstances at the point the tenancy was granted. Of course, referencing cannot predict the future. A tenant’s employment, income or personal circumstances can change after they move in. But it can help establish that the landlord took reasonable steps to understand the applicant’s circumstances before agreeing to the tenancy.

The goal isn’t to eliminate risk

No referencing process can guarantee that a tenant will never fall into arrears or breach their tenancy.

Life happens.

People lose jobs, relationships break down, businesses fail and circumstances change.

The purpose of referencing is therefore not to create a completely risk-free tenancy — because that doesn’t exist. Instead, it is about reducing avoidable risk and making better-informed decisions. That becomes particularly important in a rental market where landlords have fewer straightforward routes to end a tenancy.

 Professional referencing is becoming part of good risk management

The Renters’ Rights Act is ultimately designed to give tenants greater security and stability in their homes. For good landlords, that doesn’t need to be viewed as a negative. A landlord who selects the right tenant, sets the tenancy up correctly and manages the property professionally should benefit from a stable, well-run tenancy.

Tenant referencing is an important part of that process. It allows landlords to move away from assumptions and towards evidence. It can help identify affordability concerns, verify information supplied by applicants and establish a consistent process for making letting decisions. And, crucially, it can help landlords approach tenant selection in a way that is both commercially sensible and legally compliant.

The bottom line

The Renters’ Rights Act hasn’t made tenant referencing less relevant. It has made getting tenant selection right even more important.

With Section 21 no longer available and stronger protections for tenants now in place, landlords need to think carefully about risk before a tenancy begins rather than relying on an easy exit if things go wrong. Thorough referencing won’t eliminate every tenancy problem. But it can reduce avoidable risk, support fair decision-making and give landlords greater confidence that they are entering into a tenancy with their eyes open.

In the post–Renters’ Rights Act market, good tenant referencing isn’t just about protecting the landlord — it’s about creating the foundations for a successful tenancy for everyone involved.

If you’re looking for advice with selling, letting, buying or renting your home, we would be delighted to have the opportunity to discuss the options available. Feel free to call us on 0203 985 1976.