Rental Shortages Could Make 2023 Difficult For Students

Student lets have come under the spotlight as a result of a slowdown in the building of new university student accommodation and record numbers of students taking up their places during 2022 – in part as a result of many deferring their studies during the pandemic. 

A recent report estimated that 1.63m students will require some form of rental accommodation during the course of their studies. Figures released by Propertymark also showed that the general number of properties available to rent has decreased by 49 per cent during the past three years. 

Various analysts have suggested that the causes of the UK’s rental property shortage - including increasing obligations on landlords, rising costs as well as mortgage interest outgoings - are leading to private landlords exiting the market. 

Last month The DPS’ latest Rent Index revealed how average monthly UK rents reached £903 during Q4 2022: an increase of £14 (1.57 per cent) on the previous quarter and 8.27 per cent (£69) since the last quarter of 2021.

Rents in London and Scotland outstripped the Consumer PriceIndex’s 9.2 per cent annual rate of inflation, with rents in London up £160 (11.59 per cent) to £1,541, while average rents in Scotland increased by £79 (12.02 per cent) to £736 during the same period. 

Historically high rents combined with a growing shortage of properties has led to an acute housing issue in some student cities, for example Durham, Manchester and York.

As a parent of a first-year student, I have seen for myself why students need to  start searching and reserving a second-year property within weeks of arriving at their institutions. Typically these decisions are made before a student has worked out the best location for themselves. 

There are reports of students queuing through the night outside letting agents’ premises to secure a property for the next academic year. 

Some students, propelled by the shortage of university accommodation and private rental stock, have resorted to living in neighbouring towns or cities and travelling some distance to attend lectures.  

One unintended consequence of the current rental stock shortage is that some students may be tempted to sign up for properties they see briefly or have even only viewed online – and which may not really be suitable for their needs. 

Letting agents therefore have a significant role to play in managing relationships between landlords and their student renters when their tenancies start, as they progress and, crucially, as they draw to a close. 

Agents can help ensure a smooth check-out by clearly explaining from the outset student renter’s obligations in relation to the tenancy agreement and helping to resolve any arising difficulties or misunderstandings as the academic year unfolds. 

With the pressure on rental properties likely to continue beyond 2023, it is vital that agents, landlords and tenants work closely together and continue to communicate effectively.

* Matt Trevett is managing diorector at The DPS and has a child at university *

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