Landlords could find themselves in a legal tangle when asking for rent in advance if the Renters (Reform) Bill goes forward as drafted.

One of the new amendments specifies that rent periods (such as £500 per calendar month) cannot be different from the periods for which rent is payable (such as quarterly in advance) and any provision which seeks to make them will not be effective.

Tenants often want to pay rent in advance if they can’t provide enough financial references, particularly overseas tenants who could easily afford the rent but can’t show any financial history, explains David Smith (pictured), property lawyer at JMW.

“The normal means of dealing with this would be to express the rent as a monthly figure but then specify that the rent is payable six monthly in advance,” he says.

“That structure seems to be entirely prohibited by the changed wording as the payment period (the six months’ in advance part) would be of no effect and disallowed.”

Provisions

However, DLUHC is adamant that this is not what the provisions do and says rent in advance is still allowed, using a mechanism whereby a landlord would simply decline to sign a tenancy agreement until an advance rent payment was made.

“I don’t see how this would be enforceable,” Smith says. “The only means I can see of doing this would be for the contract to say it was a monthly rent, payable monthly, and then specify that the first six payments of rent had to be made together in advance.

"But neither of these options can possibly be right. The courts would be likely to take a dim view of such an approach and would see it as an effort to achieve an unlawful rent period payment by the back door.”