Editor's note: This brief was summarised by The Property AI Newsroom from a report by Mortgage Strategy. Read the original article for full details.

Tenancy Fraud Costs UK Rental Sector Up to £4.1bn Annually, Goodlord Finds

Fraudulent tenancy applications could be exposing the UK’s private rented sector to up to £4.1 billion in financial losses each year, according to research by Goodlord. The analysis, based on over a million tenant references from the past two years, highlights ongoing risks for letting agents and landlords across the country.

Goodlord’s research found that between July 2025 and June 2026, 41 tenancy applications per 1,000 references were flagged for suspected fraud. While this figure is slightly down from a peak of 46.6 per 1,000 in late 2024, suspected fraud remains well above historic levels. The data also shows that incidences of suspected fraud increased by almost 40% during 2025 compared with the previous year.

To estimate the financial impact, Goodlord combined its observed suspected fraud rate with publicly available estimates for legal costs, court fees, bailiff fees, rent arrears, void periods, and property damage. The analysis estimates the average direct financial exposure associated with a fraudulent tenancy at £9,601. Applying the current suspected fraud rate across the UK’s estimated 5.3 million privately rented households, and assuming an average of two tenant references per household, suggests the sector could face up to £4.1 billion in direct financial losses each year.

Regionally, London has the highest confirmed fraud rates, nearly double the national average. The West Midlands follows, then the North West and overseas tenancy applications. The most expensive rental properties are the biggest targets, with homes renting for more than £10,000 a month seeing confirmed fraud rates approaching 18 per 1,000 applications—three to six times higher than average rental properties.

The research also notes a shift in fraud tactics. Fraudsters are increasingly building entire fake identities, rather than relying on a single forged document. In 2025, fake employment references were the fastest-growing type of fraud, up 226.6% year-on-year. Referee fraud and identity manipulation also saw significant increases. While every major category of fraud has fallen slightly in 2026 so far, fake references, bogus referees, and forged payslips all remain above 2024 levels.

These findings underline the importance for letting agents and inventory clerks to remain vigilant and adapt their verification processes as fraud tactics evolve.