Letting to Students
Letting to students
Letting to students is slightly different from a legal perspective than renting to other types of tenants such as families or professional working couples. If the house has 3 or more tenants forming more than 1 household (a household represents 1 or more members of the same family who live together) and these tenants share bathroom and kitchen facilities then the house is classed as a house of multiple occupancy or HMO for short.
Accommodation for students
Each year the influx of students to a region where there is a university provides a real boost to the local economy and generally speaking will keep businesses that earn their trade through students in good stead for the long term supplying steady demand, subject to competition of course. The demand for houses near a University or academic institute is usually high with existing student landlords, keen parents wanting to buy their children a student house and other potential landlords wanting to give student letting a go means that properties are don’t stay on the market for long.
The closer to an academic institute the property is the more expensive the property tends to be on a like for like basis. Of course properties near student bars and clubs will be popular as well and worth looking into.
Generally speaking the student letting market has been stronger these last few years compared to other areas of the residential investment market especially in cities like London.
The demand from students for accommodation isn’t necessarily greater than the supply of accommodation available everywhere though and Leeds Unipol believed that in 2012 there would be a surplus of approximately 3,800 bed spaces leaving many landlords with unfilled rooms or worse untenanted properties.
Universities themselves compete strongly in the student accommodation market and are constantly building new purpose built student blocks. Each time a block or group of blocks is completed their share in the market can increase by several hundred students and put a squeeze on the private rental sector for student accommodation.
Rolle College in Exmouth, Devon is a good example of where a University can remove a market in one swoop. The college use to be a teacher training college and was part of Plymouth University. In 2009 the University relocated the campus with some 3000 students and 400 staff to its main campus which is over 40 miles away and the consequences had both economic and social implications in Exmouth. Many of the student accommodation properties have since been rented out to other individuals or rented out fully but the student letting market ceased.
When looking for properties with the intention of letting to students it is worth spending a bit of time researching the current market for a target area and any future developments. The University website will usually have a section on accommodation and future developments which might be able to provide some invaluable information and local estate agents should be able to provide good advice but getting the advice from several estate agents will allow you to cross reference and paint a clearer picture. We should also point out that you will require HMO Landlord Insurance, a unique insurance specifically underwritten for student property lets and we recommend you also take into account insurance factors such as flood risk, crime rates or any history of subsidence when choosing a buy to let.
What facilities should be provided when letting to students
It’s difficult to give advice on what facilities should be provided that goes into enough depth covering what students require and the regulations and standards that need to be met by law. The best advice is to go online and look up the university or academic institute website and read through the pages on accommodation.
Many universities work with their local council and student guilds to offer accreditation schemes. These schemes aim to recognise a set of standards outlining key Landlord responsibilities offering students protection and Landlords clear guidance.
The relevant local council website should provide information on what they expect from landlords and legal requirements and be a good resource for contact numbers and further avenues.
It is also important to not just set out a student let that complies with laws and regulations but it should be designed with students in mind. The more attractive and accommodating to students the property is the easier it will be to let.
Students normally pack light so the property should be furnished, not extravagant but suitable for students to quickly settle in. Rooms should be equipped with a bed, wardrobe and desk. If the rooms are on several floors or the property has quite a few rooms then more than one bathroom should probably be provided if possible. Kitchen appliances are likely to get heavy use so cutting corners to save money using cheaper appliances could end up costing more in the long run. Are the fridges/ freezers big enough for the number of student tenants in the property?
What else are you going to offer student? are all bills inclusive of rent? Are you going to offer a wifi connection? (really is a must these days) Do you want to provide direct contact details?
For all the information available on HMO’s, regulations and practices there is an equal amount of resource provided to students offering advice on what to look for when searching for a student accommodation (NUS and university websites provide such information) and it is worth cross referencing to so that you can meet all regulations and legal regulations as well get a good idea of what students are looking for.