What is a Guaranteed Rent Scheme and Is It Right for You?
November 2, 2024
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TL;DR
The Renters’ Rights Act has made rent arrears a bigger concern for many landlords because possession rules are now more formal and landlords must rely on legal grounds. Government guidance states that the mandatory rent arrears threshold has increased from 2 months to 3 months, with the notice period increased from 2 weeks to 4 weeks.
For landlords who want predictable income without chasing rent, Citywide Housing Group offers a guaranteed rent scheme with 3 to 5 year commercial leases, market rents paid, no voids, no arrears, no repairs and no tenant issues.
What’s in This Article:
- Why rent arrears worry landlords
- How the Renters’ Rights Act changes arrears risk
- Why traditional letting can expose landlords
- How Citywide Housing Group protects rental income
- Why fixed rent is becoming more attractive
- How to get started with Citywide Housing Group
Introduction
The Renters’ Rights Act has made many landlords think carefully about rent arrears. The main fear is simple: what happens if a tenant stops paying, but the landlord still has a mortgage, insurance and other costs to cover? When rent recovery becomes slower or more formal, landlords can feel financially exposed.
That is why guaranteed rent is becoming more attractive to landlords who want stable income without chasing payments.
Why Rent Arrears Worry Landlords
Rent arrears are one of the biggest fears for private landlords because they affect cash flow immediately.
If rent does not arrive, the landlord may still need to pay:
- Mortgage costs
- Insurance
- Service charges
- Maintenance bills
- Compliance costs
- Letting agent fees
- Legal costs
For many landlords, one missed payment is stressful. Several missed payments can put the entire investment under pressure.
In our experience, landlords are not only worried about losing rent. They are worried about how long it takes to resolve the issue, how much evidence is needed, and whether the property will continue to cost money while no income is coming in.
How the Renters’ Rights Act Changes Arrears Risk
The Renters’ Rights Act has changed the way landlords think about rent arrears because possession now depends on legal grounds and correct procedure.
Government guidance explains that under Ground 10, a landlord can try to evict a tenant who owes rent before they owe 3 months’ rent, but the court will only grant possession if it believes it is reasonable. Under Ground 11, landlords can try to evict where tenants have repeatedly delayed paying rent. Both grounds require 4 weeks’ notice before applying to court.
This matters because landlords may need to manage arrears carefully, record payment history properly and follow the correct legal process.
Renters’ Rights Act and serious rent arrears
Under the Renters’ Rights Act, serious rent arrears are a major concern because the mandatory threshold has increased.
Previously, many landlords understood serious arrears as 2 months. Government guidance now states that the mandatory threshold will increase from 2 to 3 months’ arrears, and the notice period will increase from 2 weeks to 4 weeks.
For landlords, this can create fear around:
- Waiting longer before mandatory possession applies
- Carrying costs while rent is unpaid
- More pressure on cash flow
- More paperwork and evidence
- More uncertainty if arrears reduce before court
That uncertainty is why many landlords are looking for a more secure rental model.
Why Traditional Letting Can Expose Landlords
Traditional letting can work well when tenants pay on time. The problem is that the landlord usually carries the financial risk when they do not.
| Traditional Letting Risk | Landlord Impact |
|---|---|
| Missed rent | Immediate cash flow pressure |
| Repeated late payments | Unstable monthly income |
| Arrears | Mortgage still needs paying |
| Court process | Time, cost and stress |
| Void period after possession | Further loss of income |
| Re-letting costs | More fees and delays |
A letting agent may chase rent, but the landlord may still be left with the financial loss.
That is the key issue.
Landlords do not only want rent collected. They want rent certainty.
How Citywide Housing Group Protects Rental Income
Citywide Housing Group gives landlords a different route through a guaranteed rent scheme.
Instead of relying on traditional private letting, suitable properties can be leased under a long-term commercial lease agreement.
Citywide Housing Group’s core landlord benefits include:
- Guaranteed Rent
- 3 to 5 year commercial leases
- Market rents paid
- No voids
- No arrears
- No repairs
- No tenant issues
Citywide Housing Group’s existing FAQ material explains that rent is paid through automated BACS, the agreed rent is the rent the landlord receives each month, and landlords are advised of the rent before signing the contract.
That makes the income clearer before the agreement starts.
Why Fixed Rent Is Becoming More Attractive
Fixed rental income is becoming more attractive because landlords want stability.
With traditional letting, income can depend on:
- Tenant payment behaviour
- Void periods
- Repair issues
- Possession delays
- Market changes
- Letting agent performance
With guaranteed rent, the landlord has a clearer rental arrangement from the start.
Renters’ Rights Act and fixed rent planning
The Renters’ Rights Act has pushed many landlords to think more carefully about long-term planning.
If rent arrears become harder to resolve quickly, landlords may prefer a model where the rent is fixed and agreed under a commercial lease.
This helps landlords plan around:
- Mortgage commitments
- Portfolio income
- Tax planning
- Future investment decisions
- Family and business cash flow
For landlords who want less uncertainty, fixed rent can feel far more practical than chasing payments every month.
Why No Arrears Matters More Than Ever
“No arrears” is one of the most powerful benefits for landlords because it directly solves one of their biggest fears.
A property can look profitable on paper, but if rent is late or unpaid, the numbers quickly change.
For example:
| Monthly Rent | Arrears Situation | Landlord Problem |
|---|---|---|
| £900 | 1 month unpaid | Mortgage pressure |
| £1,100 | 2 months unpaid | Cash flow gap |
| £1,300 | 3 months unpaid | Serious financial stress |
This is why guaranteed rent is not only about convenience. It is about protecting the landlord’s income.
Citywide Housing Group’s guarantee rental material highlights no void periods, rent paid every month on time, and no repairs or maintenance issues as key benefits for landlords and investors.
External Links
For official government guidance on the Renters’ Rights Act, visit:
For government guidance on possession grounds, visit:
Conclusion
The Renters’ Rights Act has made rent arrears feel like a bigger risk for many landlords.
The issue is simple: if rent stops, the landlord still has costs. If possession or recovery takes longer, that pressure increases.
Citywide Housing Group offers a more stable alternative through guaranteed rent, 3 to 5 year commercial leases, market rents paid, no voids, no arrears, no repairs and no tenant issues.
How to Get Started with Citywide Housing Group
If you own an HMO, family house, flat, block of flats or another suitable rental property, speak to Citywide Housing Group today.
Contact Citywide Housing Group today to schedule your free property assessment and discover how we can help you unlock the potential of your property.
For more information, visit Citywide Housing or call us at 0113 323 0678.
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