Almost one in three private renters rank a no-deposit option among the most important factors when choosing a home, according to research from deposit alternative provider Reposit. The option placed ahead of parking, pet friendliness and the reputation of the landlord or letting agent.
Reposit surveyed 1,000 private rented sector (PRS) tenants and asked each to pick the five factors that mattered most to them. A no-deposit option drew 33%, level with transport links. The rest of the ranking ran as follows:
- number of bedrooms: 31%
- parking: 30%
- landlord or letting agent reputation: 27%
- local amenities: 21%
- energy efficiency: 16%
- pet friendliness: 15%
- outdoor space: 12%
- schools: 8%
Upfront costs also weighed on renters more broadly, with 40% calling it "very important" to keep them as low as possible.
However, price, location and property quality remain the biggest considerations. Monthly rent topped the list at 90%, followed by location at 85% and the condition of the property at 74%.
Students showed a similar pattern. Almost four in 10 (39%) cited upfront costs, including deposits, no-deposit options and holding deposits, as an important consideration. That put upfront costs ahead of bedroom size (34%), transport links (31%), nearby amenities (25%), landlord or letting agent reputation (23%), internet being included (19%) and having an en suite (16%). Monthly rent again led, cited by 89% of students, with location at 76% and property condition at 64%.
Reposit said the results show affordability extending beyond rent, with the amount tenants must find upfront also shaping where they choose to live. A traditional five-week tenancy deposit now averages £1,440, which tenants may have to pay on top of their first month's rent and other moving costs.
"It's no surprise that monthly rent, location and property condition dominate where renters decide to live, but what stands out is how highly upfront costs feature," said Ben Grech, chief executive of Reposit (pictured).
"In the wider PRS, having a no-deposit option is more important to renters than parking or the reputation of the landlord or agent. Among students, upfront costs rank ahead of bedroom size and transport links.
"It shows that affordability isn't just about the monthly rent because renters also have to consider how much cash they need to tie up before they can move in.
"Tying up the equivalent of five weeks' rent in a cash deposit is a significant amount of money, particularly when tenants are also paying their first month's rent and other moving costs. Choosing a no-deposit option means those funds can remain available to earn interest, cover other major expenses or provide greater financial flexibility.
"For landlords and letting agents, giving tenants greater choice over how they manage that upfront cost can therefore be an important part of the overall rental proposition."
