The high profile industry trainer and long-time landlord reveals how the student rental market has changed and what landlords can do to get through these strange times.
“In 2018-19, of the full-time and sandwich students studying in the UK, only 19.4 per cent of undergraduates and 15.5 per cent of postgraduates lived in provider-maintained property, or in student halls owned by a university or college. At least 29% lived in accommodation rented from smaller private landlords” Source Officeforstudents.org.uk
The student letting market is a micro market within the private rented sector, unlike any other tenant group, and you either love them or hate them but it cannot be denied that students are a significant part of demand for private rented accommodation.
I love them and I do my best to keep them safe (often saving them from themselves) and happy while they enjoy a time of their lives which probably won’t ever come again.
Covid19 has caused me stop and re-think a routine with which I have been familiar for almost 50 years. My concern is that some landlords haven’t got the information or experience to understand the issues which are not immediately obvious. I am writing this for those landlords in the hope of helping them to avoid making expensive mistakes at a time when you don’t need any further stress.
Possession means that the property is in your control it doesn’t mean, as some people think, that you own the property.
- We give the keys to a new tenant – that tenant now has legal possession. Even when he doesn’t pay the agreed rent, even when there is no signed contract, even when a signed contract has come to the end of the fixed term.
- How do we regain possession – there are ONLY two ways
1. The tenant surrenders the tenancy and returns the keys to the vacant property
2. Enforcement of a Court Order, either when the tenant leaves voluntarily on the date the Judge decrees or when a Bailiff enforces the Court Order and gives you back possession.
- When is it illegal to take possession – When the tenant doesn’t want to leave, even when the end of the fixed term has arrived or the date decreed by the Court Order. Landlords cannot enforce a Court Order, force a tenant to leave for any reason whatsoever, move contractors or new tenants in while the property is occupied by even one of the original tenants. NB.
The purpose of this article is to protect the many landlords who only let to students and who are used to the annual migration from one property to another on 1st July or thereabout. Those landlords who need to read this have no experience of having a group of tenants who are on the doorstep with their worldly goods, waiting for access only to find that the previous tenants haven’t moved out nor do they intend to at that time
Those of us who let to non-students know that it is risky to re-let a property until we are certain that we will have vacant possession from the previous tenant and we certainly wouldn’t allow new tenants to rock up until we had checked that the previous tenants had moved out, carried out an inspection and collected the keys.
This is however quite common in the student market where it’s not unusual for the outgoing group to be passing the incoming tenants in the hall. It’s often chaotic and stressful but it’s all part of the charm of letting to students. Ask any cleaner who has been on her hands and knees while people are moving both in and out. Often landlords get a kick in the pants when they need to go through the arbitration process of the deposit protection scheme and they have no check in or out inventory.
All well and good but not this year!
This is the year where the cycle was broken in the student community. No viewings for weeks, some members of the group gone home, some stuck abroad and some still living in a rented property but with no property in which to move. Then there are those who did sign a contract for a new property but are now stuck with people dropping out of the group and the fear of being responsible for the rent for the whole house because they all signed a joint tenancy with deposits and guarantors.
What does this mean for landlords?
We need to learn and act quickly.
First a word to those who are thinking “I’ve got signed contracts and they are responsible for the rent for the year whether they move in or not” Good luck getting a judge to award you 12 months rent. Google force majeure and you will see why.
Some words of advice from Paul Shamplina of Landlord Action:
“I’ve had numerous calls from Student landlords affected by this pandemic and the fear that students will not move in to their properties as Universities are closed. I had one agent who had 30 students refusing to pay their rent on the advice of their University.
If landlords have pre contracts signed, but not executed with tenants refusing to move in, I think open lines of communication , practicality and common sense has to prevail, mediate. The Government have made it clear that students have to pay their rent and of course they will have their parents as guarantors. If a student refuses to move in, the landlord cannot afford that property lying empty for the term of the tenancy and risk trying to pursue the student for unpaid rent through the courts, who knows if a judge deems this contract broken under terms of Force Majeure. I know some landlords are now looking to convert HMOS back into family homes so they can let ASAP. This pandemic has caused crisis especially in the student rental market.”
We need to manage the situation carefully, following government guidelines for viewings and for moving home. These are for England
The Scottish Government have said that they plan to allow the property market to reopen on 18th June.
Up dates from Welsh Government
Up dates for Northern Ireland
Plan of action
Contact each individual existing tenant and ask:
- Are they and their families well?
- Are they still in your property? If not have they moved out completely? If they are still there, what are their plans for the end of the tenancy?
This will tell you where you stand.
Some of them will have returned home but without all of their belongings, if this is the case you need to ask whether they have a new property to move into for next year. The answer will open a discussion about when they intend to move out. We may need to take a hit on the cleaning bill this year (the tenant fees ban prohibits us charging for this) or we can reclaim from their deposit – probably not a great idea and if you get vacant possession on the last day of the tenancy be grateful and move on.
Some of them will tell you that they have already moved out lock stock and barrel don’t be tempted to ask for the keys to be returned early unless they offer, unless you want to give them a rent refund but make it easy for them to return them to you before they come back to move into a new property – offer to pay for the postage
Some of them will be in the property, often alone and unable to return home or without family support in the UK; a problem and an opportunity. Send them a pizza and ask if they need any help either now or at the end of the contract. It’s worth transporting their belongings to another student house to get your own back with vacant possession.
If you have tenants who are still in the property and who have nowhere to move to this could be an opportunity to fill a room where one person has dropped out of the group or find another landlord with an empty room, make his day and enable your tenant to give you your property back without pressure.
If you end up with a tenant who won’t move out you need to go through a lengthy Possession Process under Section 21 of the Housing Act 1988.
Whatever happens DO NOT ASK OR TELL THE TENANT TO MOVE OUT… THIS IS AN ILLEGAL EVICTION AND CARRIES VERY HEAVY PENALTIES INCLUDING LOSING YOUR “FIT AND PROPERTY PERSON” STATUS WHICH PREVENTS YOU BEING THE LICENCEE OF AN HMO.
Find a landlord with an empty property and organise a viewing or virtual viewing for the students who cannot now move into your property. Otherwise you will face a claim for Breach of Contract on top of everything else.
Letting the property
If you’ve got empty properties or rooms:
Do not waste time arguing with students or guarantors, don’t count the cost, communicate with your existing and new students and offer them money if they let a room for you. Post on Face Book Groups and any online letting sites. Contact local landlords, local letting agents and anyone in the university who may want to help to make this less painful than it needs to be.
Remember if you can’t get a group of students there are other groups who might like to live in a lively young area just be careful not to let to a family if your property is in an Article 4 Area because you will lose your Established Use as an HMO
There will be some students who were due to go abroad for next year and others who were due to go on placement, many of them will return to their university, even where much of the learning is online and they will need accommodation, this may go on throughout the summer stick with it.
How online learning will impact on the student market it a discussion for another day.
Remember to continue to protect yourselves, your contractors and your tenants. I wish you luck at this stressful time and sincerely hope that students will continue to “go to the fountain of knowledge to drink”.