Date Published 11 October 2024
Experts within the student-based market have recently expressed serious worries about the Renters' Rights Bill that is being considered. Studies indicate that 32% of student housing especially one- and two-bedroom homes and apartments could be at risk. These properties are important in the student rental market. If nothing changes these houses will not be safe which could cause a big problem with not enough places for students to live by 2026 if the law is passed as is.
The main problem is that one- and two-bedroom properties are not given the same protections as HMOs. It has been reported that 32% of all house and flat listings on the platform are made up of these smaller properties which have become more popular since the Covid-19 pandemic. If the Bill isn't modified a lot of landlords might take their homes off the market for students. This could lead to not having enough places for students to live. Student landlords are very worried about the rule that stops them from having fixed-term rental agreements which has always been an important part of the private rental market. These agreements give landlords a clear idea of how long a tenant will stay so they can better prepare for the rental cycle during the school year. According to the new law fixed-term rental agreements will be changed to rolling agreements. This means tenants can now leave with just two months' notice whenever they want.
Some people say that this change makes it risky for landlords because they can no longer be sure that students will leave their properties when the school year ends. HMO properties can be reclaimed by landlords in the summer to get ready for the next group of students. However, this rule does not apply to one- and two-bedroom properties which are usually not registered as Houses of Multiple Occupation. Therefore, some smaller landlords might choose to leave the market for renting to students completely. This would lead to less student housing available especially for postgraduates' international students and smaller groups who need one- or two-bedroom homes. This loophole in the law might cause landlords to increase the rent for the few properties that are still available putting more financial pressure on students who are already finding it difficult to afford the increasing cost of living. Even before the suggested alterations the cost of renting for students has already gone up significantly. Furthermore, studies have shown that the cost of renting student housing has gone up by 13 percent. In the past year the cost of housing has increased by 9% and the price of renting student dorms has gone up by 15%. Excluding smaller properties from the Renters Rights Bill might cause rents to go up even more making it even more difficult for students to find affordable places to live.
Platforms that focus on student housing are asking the government to review the current rules in the Renters Rights Bill. They want the summer move-out exception to apply to smaller student apartments and houses with one or two bedrooms. This change is very important to make sure that landlords who own smaller properties can feel confident in renting to students without worrying about the costs and challenges of having tenants move in and out frequently.
Student Holmes (our established student property partner) is more than happy to be of assistance in the coming weeks as Landlords begin to market their student letting portfolio. Please feel free to give us a call and our highly experienced team will be able to offer the required assistance.
