Honourable and personal residential letting experts


Advertised rents don’t tell you what is happening in the market 

When you come to remarket, your property, how do you judge what price to advertise it for?

It won’t surprise me if you say you ‘look at Zoopla or Rightmove and add 10%’. 


Everyone is saying that the market is buoyant and there are lots of applicants in the market.

Both statements are true but there is one big piece of the jigsaw that is not apparent…and that is applicants’ affordability and what that means when the referencing takes place.

Most referencing companies will pass someone if the levels they set for affordability are there.  They will be judging affordability based on 2.5 times the annual rental. For example, if the monthly rental is £1,200 the applicant would get a pass if they can prove a household income of £36,000 or more. If they can only prove a household  income of £35,000, they would not pass referencing. 

The problem is that most referencing companies have an insurance arm that will offer the landlord a rent guarantee policy. As long as the applicant ‘passes referencing’ then the rent guarantee policy would be valid.

Last year we reported that the average household income in the Cambridgeshire area was £55,000. Any information we can find shows this hasn’t increased over the last 12 months, but advertised rents certainly have! 

The effect of this is we have seen that any property advertised over £1,200 per month is taking longer to find a tenant. Even though there are lots of people who are looking to rent it. 

The reason for the hold-up is to find someone that fits the affordability criteria.

The obvious question is why have a self-imposed rule that is putting a hold up to people finding a new home.  Moving forward this will have an impact on the prices that can be achieved, and we can see that this will have the effect of levelling up prices.

What are we doing about the log jam 

Because we look at data we can see the effect this has had on the asking price since October.

We work very closely with OneBroker who provide us with our own ‘Block Legal Expenses & Rent Guarantee’ policy which some of our landlords have opted to have under our enhanced service, the benefit being that we can talk to someone as opposed to deal with a computer algorithm.

When it comes to making a call on someone’s affordability we review six months bank statements, obtain employer references and a current landlord reference then make a call on how that individual is managing finances. If we feel confident that the affordability is there but they may be slightly short of the 2.5 calculation set by the insurers we will talk with our brilliant OneBroker representative (Rob), who will be able to talk directly to insurers to make sure that our block insurance will cover us as the policyholder and your tenancy.

If you have any questions about affordability and how it could affect you, pick up the phone and give us a call – we are happy to help!