Rent arrears: prevention tips for landlords

Just when you thought the cost of living couldn’t get any higher, geopolitical tensions send the price of fuel skywards. Making our money go further applies to the majority but there’s one group who may be feeling the pinch a little more. Renters.          

Landlords need to be watchful for signs of financial distress, especially given the background. Recently released research by Propoly found English landlords are collectively chasing more than £470 million in rent arrears annually. The detail showed an estimated 210,163 rented households fell into arrears during 2024 and 2025, with the average amount £2,238.

The issue isn’t confined to England either. In February 2026, analysis by the SafeDeposits Scotland Charitable Trust found 29% of tenants surveyed had struggled to pay their monthly rent over the past year. 

Although there are no arrears figures available for Wales, the Office for National Statistics’ newest data revealed average rents increased 5.8% in the year to January 2026 – the biggest rise among the home nations and added pressure on income.

Good practice and professional management can reduce the risk of rental arrears occurring. There are several pre-, mid- and post-tenancy steps landlords can take, which include:

• Undertaking expert tenant referencing

Referencing establishes whether a tenant has the ability to afford the rent being charged. It will take into account the applicant’s wage and credit history, as well as verify employment status.

• Adding a clear clause to the tenancy agreement

It’s wise to add a deposit use clause to every tenancy agreement when it’s being created. This ensures the tenant is aware that any arrears at the end of the tenancy can be deducted from the deposit held. Not every template tenancy agreement will feature this clause, so pay attention before any contact is signed.  

• Take out rent guarantee insurance

Even the most reliable renters on paper can experience unexpected financial hardship so taking out a rent guarantee insurance policy provides a sensible back up. The policy will pay out and cover missed rental payments but ensure any policy applies when a renter defaults but still lives in the property. 

• Seek a guarantor

Deciding to prioritise tenants who can provide a guarantor is a good way to mitigate rent arrears. If the tenant has a guarantor in place – one who has also passed referencing – they will be called upon to cover the rent if the tenant can’t afford to pay.

• Keep communication friendly

Not being able to afford the rent can be embarrassing for the tenant and if their relationship with the landlord isn’t good, they may bury their head in the sand. Arrears, and even the potential for missed payments, can be managed far better if the tenant feels comfortable approaching the landlord with their concerns.  

• Be ready with compassionate solutions

Not all arrears represent a fatal flaw – many situations are temporary or can be resolved with some negotiation. Options open to landlords include repayment plans, rent holidays and rent reductions. It is, however, vital that all figures, agreements, durations and penalties are detailed in a written agreement, signed by both the landlord and the tenant.

Evictions due to arrears: what’s changing on 1st May 2026

The Renters’ Rights Act changes the way landlords in England can evict tenants for late or unpaid rent. From 1st May 2026, landlords have to use a Section 8 notice to regain possession, with one mandatory and two discretionary grounds applicable if there’s a problem with rent payments.

Ground 8 (mandatory) can be used when rent arrears reach a certain threshold. The threshold increases on 1st May 2026, from 2 months' rent for a monthly tenancy (or 8 weeks' rent for a weekly tenancy), to 3 months' rent for a monthly tenancy (or 13 weeks' rent for a weekly tenancy). 

In plain English, landlords will see more arrears build before they can apply to evict. The minimum notice period given before issuing a possession claim using Ground 8 will increase from 2 weeks to 4 weeks on 1st May 2026.

Ground 10 (discretionary, when any amount of rent arrears is due) and Ground 11 (discretionary, when the tenant has persistently paid rent late) remain unchanged. The notice period will stay at 4 weeks before a landlord can apply to the court.

In Scotland, The Housing (Scotland) Act 2025 has the potential to change the eviction process due to arrears. When implemented, the First‑tier Tribunal will be required to consider whether it should delay the implementation of an eviction in light of the circumstances of both landlord and tenant. 

There are no changes currently planned for Wales. Landlords can serve notice if a tenant is in arrears of two months or more, with a 14 day notice period.

If you have concerns about rent payments or want to ensure future tenants are financially sound, please contact us.