Referencing your tenants is most definitely more than common sense for multiple reasons.
You as a landlord are required to make sure all adults living within a property you own are legally allowed to rent (Right to Rent). This can be another area which a lot of landlords fall foul of. The fines are catastrophic and failure to comply can lead to prison sentences.
You will also want to make sure that you do not have criminals living in your property and that your tenants are able to pay the rent for the term of the tenancy and thereafter if they remain in the property.
There is a piece of new legislation also requiring all Landlord's to pass Sanctions checks, we are able to provide this service for you.
Any insurance or mortgages you hold on the property, may be void if you do not carry out adequate checks on the people residing in your asset.