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Landlords urged to remain calm as students return to their parental homes

Student property has long been one of the most lucrative investments available to landlords, with sky-high double-digit yields typically available in many parts of the country. 

But the departure of thousands of students from UK universities and colleges back to their parental homes has led to concern from landlords and letting agents. 

Some student tenants seem to think that they are no longer liable to pay rent on their accommodation, and this could see many landlords running into debt. 

Giles Inman, business development manager at the East Midlands Property Owners Group, which represents around 600 landlords in the city, told the Nottingham Post: “We are getting students contacting landlords saying they are moving back to their parental homes and some of the students are saying 'do they need to pay any more rent?

“A tenancy agreement is a legal contract. If the landlord pursues the student, well, we do not want to go down that road. It is all about being in it together.”

Marcus Askam-Yates, director of Student Housing, which has offices in Lincoln and Nottingham, is urging landlords to remain calm despite many students deciding to leave their rented accommodation and return to their parents.

He points out that the government is still continuing to issue student loans, and so there is no reason for tenants attending university not to pay their rent.

Askam-Yates said: “I guess we, like a lot of agencies and have had several phone calls and emails from concerned landlords, worried that their rental income will decline during the current situation.

“We have reassured them that as all tenants have signed legally binding contracts with us. Students are still able to live in their homes properties as normal, without additional risk. The government has advised against non-essential travel, and so many of our tenants have stayed in their accommodation. 

“Of course, the tenancy does not require the tenant to physically reside within the property, and it is their right to vacate their rented property, but the tenancy agreement remains unaffected. Landlords have to keep to their obligations under the tenancy, and it's expected that tenants will adhere to their obligations too.”

Askam-Yates continued: “We have had several students ring us about what happens to their rent if they decide to leave their home temporarily and if a discount will be issued if they no longer live at the property. Most universities are still offering online or remote learning and Student Finance has confirmed that tuition and maintenance loan payments will continue to be issued, so the vast majority of our tenants understand that they need to continue to pay rent in line with the tenancy.

“As all student tenants are still expected to pay rent, the vast majority of landlords will see no changes to rental income and should have no issues paying mortgages each month.

“We understand that some students use their part-time jobs to top up the loan payment in order to pay their rent. In these circumstances, we're asking guarantors to step in and provide rent guarantees or offering deferred payment plans to the tenants as the response to the pandemic unfolds.”

“Tenants suffering financially as a result of COVID-19 should contact their agent for a payment plan as soon as possible.” 

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    In Scotland there are no leases and many students are leaving now with no notice. I hope there aren't enough flats for them when they come back! Presumably University lecturers are still being paid for doing nothing instead of just a little?

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    • S S
    • 25 March 2020 10:51 AM

    So student receiving their loans means they shold pay their rents! My student son receives £1,386 in student loans - his monthly rent is £540 per month. He lives in a house with 4 other students. They are requesting a tenancy surrender for 1 month - and if the LL keeps all the deposit (9 weeks as they had to pay the deposit and sign the agreement 9 month before they moved into the house) she will lose LESS than one months rent. Between the 5 of them they will have paid £29,700 rent for 11 months on a 5 bed roomed house in Oxford. He's at Brookes University not Oxford University. In this unprecedent situation is it really too much to ask? Students have to pay deposits 9 months in advance - in most cases they have to pay for 12 months rent and the LL knowing that the students always leave in the summer still charge FULL rent and any cleaning/repairs whilst students are at home. My son's contract finishes on June 30th, the new set of tenants start their contract on 1st July......I'm a LL as well as a business owner and so many student in many cities are taken advantage off - they don't have a choice. My daughter is at Cardiff and at least there some LL offer 1/2 rent in July and August. But they all want signed contracts and deposits 9 months in advance. No other private tenant faces these problems.

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    Totally agree with your first sentence! The flat can't be dismantled and shipped to other areas of demand for the summer. Its overheads need paid for 12 months a year. A University education, even at a lower tier one, has to be paid for. It's supposed to be an investment unless it's for a media studies degree etc. Look at the long term like landlords have to do and weather the current storm.

     
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