In a surprising shift in the UK’s rental market, even those with substantial incomes are increasingly being asked to provide guarantors when renting properties. Recent data from the rental platform Goodlord highlights a significant change in landlords’ expectations.

Surging Guarantor Requests Among Different Income Brackets

• Middle-Income Group (£50,000-£74,999): There’s been an astonishing 82.3% increase in guarantor requests since 2020. In 2023, 2.68% of tenants in this income bracket were asked for a guarantor, a notable rise from 1.47% in 2020.
• Higher-Income Group (£75,000-£100,000): The trend is even more pronounced here, with 1.72% of tenants being asked for a guarantor in 2023. This figure represents a 187% jump from the 0.6% in 2020.

The Changing Face of Tenancy Guarantor Requirements

Oli Sherlock, Goodlord’s Managing Director of Insurance, sheds light on this evolving trend. He notes that traditionally, guarantor requests were primarily aimed at student tenants or those appearing to rent beyond their means. However, post-pandemic, this practice expanded to include a broader demographic.

Why the Shift?

• Pandemic Impact: The COVID-19 pandemic has been a significant catalyst. The consequent uncertainty led landlords and agents to seek additional assurances from a wider range of tenants.
• Beyond Traditional Groups: High earners are now more likely to need to provide guarantor details, a departure from previous norms.
• Landlord’s Perspective: Landlords have navigated four years of uncertainty and complex regulatory changes. Their heightened desire for security, while frustrating for financially stable tenants, is understandable in this context.

Caution Against Excessive Guarantor Use

While acknowledging the importance of guarantors in the rental market, Sherlock advises against their overuse. A balanced approach is essential to maintain a healthy rental environment.

Broader Trends in the Rental Market

The overall percentage of tenants asked for a guarantor has seen a modest increase from 17.7% in 2020 to 18.4% in 2023. Interestingly, renters under 30, who constitute over 55% of the renting population, are almost 8% more likely to be asked for a guarantor today, irrespective of their income level.