If you operate a rental property that is close, or accessible to a university or institute of higher learning, letting it to students may be a lucrative option. Putting aside the stereotypes of the messy, hard-partying undergraduate, there are real disadvantages to renting to students, but these can be mitigated as long as the landlord knows what to watch out for. Let the landlord solicitors at Romain Coleman walk you through the finer points of renting to students.
If your property is near a university or has reliable transport links to one, you already have a great advantage. The type of property also matters, as a new and modern apartment will be much easier to maintain than a period building that requires more repairs. Other factors a student may look for include affordability, the proximity of amenities, safety and utilities such as laundry and Wifi. University students look for a safe, affordable place to live with furnished and functional properties. Therefore, you can expect to save on expensive fittings and décor, and choose robust flooring and walls that are easy to maintain instead.
A rental property that houses students will almost certainly fall under Houses in Multiple Occupation (HMO) regulations. This is a law that governs a rented property that house more than five people, forming two or more households. There are additional legal requirements for HMOs governing safety, amenities and overcrowding, so check with your local council or landlord solicitor to see if your property meets the rules. Do note that HMO regulations have changed as of 1 October 2018, and fines for non-compliance have increased significantly.
One of the disadvantages of letting to students is the high tenant turnover. You will need to deal with short-term leases that follow the school semester. This means that if a tenant leaves in the middle of a lease, you may be stuck with a vacancy for the rest of the year as most students would already be settled in for the year. You will also have to deal with individual tenants, increasing the amount of administrative work. Combine this with the prospect that you may sometimes have to evict tenants for breach of lease before the tenancy is up, and it is understandable that a landlord would not want to bother with the trouble of letting to students.
One way around this predicament is a joint tenancy. This is when all the students in the house sign the same tenancy agreement and are all responsible for costs. Therefore if one tenant fails to pay their rent, the other tenants can be held liable. If one tenant leaves before the tenancy is up, the remaining students are responsible for finding a replacement. You may also word your tenancy agreement to cover the whole year so that you are not faced with an empty property during the summer vacations.
It can also be difficult to screen students for employment, credit and rental history compared to working adult tenants because they have mostly been living at home before university. A landlord may require that a parent or guarantor co-sign a student’s lease so that in the event of non-payment, the landlord has some recourse to recover the rent from the guarantor. Tenants who are unable to provide a guarantor living in the UK sometimes have to put up with higher rents because of the risk.
One negative stereotype about university students is that young people living on their own for the first time tend to be poor housekeepers. Whether it is a result of high turnover, slovenliness or outright anti-social behaviour, the fact remains that student accommodation tends to need more maintenance. Unreported maintenance issues can turn into big problems if not fixed right away. Unwashed dishes can attract pests that may be difficult to rid. Their negligence may also cause damage to the property which the landlord will need to repair. Protect yourself with a security deposit, and take photos of the property before you rent it out as evidence, in case any of your tenants dispute the repair costs. If you ever face a dispute with your tenant, you can contact our landlord and tenant dispute solicitors for advice and mediation services.
While your young tenants are not your children, sometimes your neighbours may hold the landlord to account for their behaviour. Take steps to inform the students about the rules on noise levels, smoking in the house, conduct within the neighbourhood and ensuring cleanliness within and around the property. Follow up often with the tenants and neighbours to pre-empt any problems that may arise later.
If you know what to expect when letting property out to students, it can be a steady and profitable source of revenue for a landlord. Romain Coleman, the London solicitors who exclusively represent landlords, can advise you on the best course of action. Call us now on 020 8520 4555 or contact us via our Online Form and we’ll be in touch with you soon.
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This post is not legal advice and should not replace professional advice tailored to your specific circumstances. It is intended to provide information of general interest about current legal issues.