“Landlords should also avoid feeling pressured into rushing the process simply because they want to get a property occupied. “
A recent report from Goodlord claims tenant fraud could expose the private rental sector to £4.1 billion in losses each year, with AI making it easier to create fake payslips, references and even entire identities. Between July 2025 and June 2026, 41 in every 1,000 tenancy applications were flagged for suspected fraud – underlining the growing challenge facing landlords when verifying prospective tenants.
These figures suggest that in this new AI landscape, landlords will need to look beyond paperwork alone, ensuring claims are properly verified rather than relying on documents that may have been doctored. The challenge is that AI technology is advancing rapidly. Historically, creating convincing fake documents required a degree of technical expertise and could be a cumbersome process. Today, generative AI tools can make creating sophisticated content far more accessible and as the technology evolves, spotting fraudulent documents is likely to become even trickier.
So what does this mean in practice? For landlords, it means carrying out in-depth checks and looking beyond the documents presented. Information provided by prospective tenants should be independently verified wherever possible, whether that means checking an employer and their contact details, confirming previous addresses and landlord references, or looking for inconsistencies between different pieces of information. A payslip or reference may look legitimate on the surface, but landlords should be asking whether the details behind it stand up to closer inspection.
One practical example is the use of Open Banking. Rather than relying solely on payslips or bank statements supplied by a prospective tenant, landlords or their referencing providers can use services which, with the applicant’s consent, securely access financial information directly from their bank. This can help verify whether the income being declared is actually being received, while providing a clearer picture of whether rental payments are likely to be affordable.
There are also relatively simple checks landlords can carry out themselves. If an applicant provides an employer reference, for example, don’t automatically rely on the phone number or email address they have supplied. Check that the business exists, independently find its contact details and, where appropriate, double check that the person providing the reference genuinely works there.
The same principle applies to previous landlord references too. Taking an extra step to establish that the potential tenant is genuinely connected to the property can help identify inconsistencies that paperwork alone might not reveal. Landlords should be looking at the application as a whole and asking whether the different pieces of information make sense when viewed together.
The key is to build up a complete picture rather than relying on any one check in isolation. If somebody’s stated salary, employment history, previous address and financial information all correspond, a landlord should have much greater confidence in the application. If something doesn’t add up, that should be a reason to investigate further rather than simply accepting the document at face value.
Importantly, this does not mean landlords need to become fraud investigators or approach every application with suspicion. There are established tenant referencing and identity verification services that can carry out many of these checks on their behalf. For smaller landlords in particular, paying a little extra for
third-party verification can save money in the long run, especially when you consider the potential financial and practical consequences of accepting a tenant based on fraudulent information.
This is particularly important for people who are relatively new to buy-to-let. When purchasing an investment property, landlords will often spend considerable time carrying out due diligence on the property itself, looking at everything from its condition and location to rental demand and the numbers behind the investment. The same level of care needs to continue when it comes to selecting who will actually live in it.
Landlords should also avoid feeling pressured into rushing the process simply because they want to get a property occupied. An additional few days spent properly verifying an application could prove invaluable if it identifies an issue that might otherwise have been missed. A short period without rental income can understandably be frustrating, but making a decision without completing the necessary checks could potentially create a much bigger problem further down the line.
None of these measures can completely eliminate tenant fraud, but they’re a great way to make sure you’ve done as much as possible to avoid any potential hiccups.
Ultimately, good due diligence has always been about reducing risk rather than simply completing a checklist. AI hasn’t changed that, but it has changed what thorough due diligence needs to look like. Landlords who recognise that distinction will be much better placed to protect themselves from fraudulent harm.
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