Bidding ban, rent-in-advance cap and anti-discrimination rules explained

General information only, not legal advice. Verify specific situations with a qualified solicitor.

Ask most landlords what the Renters’ Rights Act 2025 changed, and they’ll say “no more Section 21.” Fair enough — abolishing no-fault evictions was the headline. But three quieter provisions, all in force since 1 May 2026, carry their own civil penalties and create practical traps that are surprisingly easy to stumble into: the ban on rental bidding wars, the cap on rent paid in advance, and new rules on discrimination in tenant selection. The good news is that robust affordability referencing is still entirely lawful — you just need to apply it correctly.

The bidding ban: one price, displayed everywhere

Under Chapter 6, Part 1 of the Renters’ Rights Act 2025 (Section 56), every property listing must state a fixed, proposed rent. That figure is not a floor for negotiation — it is the price. Landlords and agents are now prohibited from inviting, encouraging, or accepting any offer of rent higher than the advertised amount, even if the applicant volunteers it unprompted.

The rules apply across every advertising channel. You cannot list at £1,200 pcm on one portal and £1,250 pcm on your own website. You cannot describe a rent as “from £1,200” or “offers around £1,200.” The figure must be exact and stated on a clear basis of payment — weekly or monthly.

Enforcement sits with local councils, which can issue a civil penalty of up to £7,000 per breach. Importantly, the bidding ban is treated as a breach rather than a criminal offence — so it does not escalate to the higher £40,000 penalty tier that applies to some other parts of the Act. Where a landlord or agent commits a repeat breach of the same provision within five years, the council may add a further civil penalty (again up to £7,000) on top of the penalty for the repeat breach (GOV.UK, Civil penalties under the Renters’ Rights Act 2025). The practical upshot: keep a clear audit trail of what rent was advertised, when, and on which platforms. If an applicant spontaneously offers above the asking rent, decline it and document the refusal.

The rent-in-advance cap: no more six months upfront

Before 1 May 2026, requiring several months’ rent upfront was a common — if controversial — way for landlords to manage perceived risk, particularly for overseas or self-employed applicants. Sections 8 and 9 of the Act end that for new tenancies.

For all new tenancies entered into on or after 1 May 2026:

• Before the tenancy agreement is signed: no rent may be collected at all, nor may landlords or agents invite or encourage such a payment. Holding deposits (up to one week’s rent) and tenancy deposits (up to five weeks’ rent, where annual rent is under £50,000) remain permitted, but rent itself is prohibited.
• Once the tenancy agreement is signed: landlords may collect a maximum of one month’s rent (or 28 days’ rent where the rental period is less than one month) before the tenancy commences.
• Any clause in a tenancy agreement requiring rent to be paid further in advance — quarterly or termly, for instance — now has no legal effect.

Existing tenancies are not retrospectively affected. Prohibited rent-in-advance payments are enforced through the Tenant Fees Act 2019 framework: a civil penalty of up to £5,000 for a first breach, rising to up to £30,000 (or prosecution) for a further breach within five years.

The practical adjustment for landlords worried about risk is to lean more heavily on referencing and, where appropriate, guarantors. A financially sound applicant — verified through a thorough reference check — substantially reduces the need for upfront cash security. See how PropertyGoose’s referencing process works.

Anti-discrimination rules: what you can no longer do

Chapter 3, Part 1 of the Act (Sections 33-42) bans “rental discrimination” in England, also in force from 1 May 2026. Two categories of applicant now carry explicit statutory protection in the lettings context: people who receive benefits and people who have children (defined as anyone under 18 who would live at or visit the property).

In practice:

• “No DSS,” “no benefits,” and any equivalent wording is unlawful in advertisements.
• Blanket policies refusing benefit claimants or families with children are prohibited, even if they originate from a mortgage condition or superior lease — those clauses now have no effect.
• Indirect discrimination is caught too. A criterion that has nothing to do with someone’s benefit or family status on its face, but which disproportionately screens out those groups without good reason, can still breach the rules.
• Applying different conditions to benefit claimants — for example, requiring a guarantor from a benefit recipient but not from an employed applicant with a similar profile — is discriminatory (this example is given in GOV.UK guidance).
• Discriminatory clauses in insurance contracts that are renewed or start after 1 May 2026 have no effect and cannot be used to justify turning an applicant away.

Penalties mirror the bidding ban: up to £7,000 for a first breach. Where the breach continues for 28 or more days after a local authority notice, a further penalty of up to £7,000 may follow (and again for each subsequent 28-day period), and a repeat breach of the same provision within five years attracts an additional penalty of up to £7,000 (GOV.UK, Rental discrimination under the Renters’ Rights Act 2025).

A limited exception exists for children only (not for benefit claimants): landlords may restrict occupancy where there is a genuine, proportionate reason — HMO licensing requirements causing overcrowding, or a proven safety hazard, for example — provided no reasonable alternative exists. A financial aim alone does not meet this test.

Affordability checks: still lawful, but apply them uniformly

Here is where many landlords and agents are understandably confused. The discrimination ban does not prevent you from referencing applicants or setting income requirements. GOV.UK guidance is explicit that landlords and agents “can carry out referencing checks… based on affordability, but not on the basis the prospective tenant has children or is in receipt of benefits.”

There is no statutory income multiple. A benchmark of 2.5 times the annual rent (equivalent to roughly 30 times the monthly rent) is a common industry convention; some referencing services use a more conservative 3× threshold. Both are lawful, provided the same test is applied identically to every applicant — but neither is set by the Act, so treat any specific multiple as a business choice, not a legal rule.

The critical requirements are:

1. Count all income equally. Universal Credit, Housing Benefit, Local Housing Allowance and other benefits must be included in the affordability calculation on the same basis as employment income. GOV.UK guidance gives a worked example: a referencing service that ignores benefit income when assessing affordability applies a discriminatory criterion — and using that service could expose you to a penalty.

2. Apply the same threshold to everyone. Do not raise the income multiple, or add a guarantor requirement, specifically because an applicant has children or receives benefits. If guarantors are part of your process, require them consistently or on the basis of credit criteria that apply to all.

3. Document your decisions. If you decline an applicant, record the reason — and make sure it is the same reason you would apply to any other applicant who failed the same criterion.

A compliant statement of criteria might read: “Applicants must demonstrate combined household income of at least 2.5 times the annual rent. All income sources, including benefits, are counted equally. A guarantor may be required where a credit check returns an adverse result, regardless of employment status.”

Our tenant referencing service is built to handle all income types correctly, producing a clear pass/refer/fail output without applying criteria that could expose you to a discrimination claim. Compare how we approach referencing against other providers.

What to do now if you’re a landlord or agent

If you manage properties in England, three actions are worth taking today.

Review your advertising templates. Remove any wording that implies a minimum rent, tenant-type preference, or willingness to consider higher offers. Make sure the rent figure is identical across every platform.

Update your application and referencing criteria. Write down the income threshold and credit criteria you apply. Confirm that your referencing provider treats all income sources equally, and remove any blanket “professional employment only” wording from application forms — a criterion like that risks indirectly screening out protected groups.

Adjust your pre-tenancy payment process. Do not collect rent before the tenancy agreement is signed. Collect a maximum of one month’s rent at signing. If your templated agreement contains quarterly or termly advance-rent clauses, they now have no legal effect — remove them to avoid confusion.

For agents, these rules apply to you in exactly the same way as they do to landlords. Your liability is separate from your landlord client’s — a compliant landlord cannot protect you from a penalty for an advert your agency wrote.

The Renters’ Rights Act is a significant shift, but the core of good lettings practice has not changed: vet thoroughly, document everything, and treat every applicant by the same written criteria. If you would like help getting your referencing process right, see how PropertyGoose works for letting agents or view our pricing.