The Government has released its draft of the Renters’ Rights Bill (RRB). After years of inaction, the student housing sector is now hurtling towards large-scale reform, with Housing Minister Matthew Pennycook even suggesting it may be in place by summer 2025. Unlike the conventional rental market, students often sign up for houses 6 to 11 months before the tenancy starts. From October, students will be touring and signing for homes that they’ll move into in summer 2025 when the RRB is likely to be law.

So, with just weeks to prepare, what will the changes mean for student accommodation?

Farewell fixed term

First and foremost, the end of the fixed-term assured shorthold tenancy — which has been the mainstay of student housing for years — will be replaced by rolling tenancies. While there are provisions for possession of student accommodation to allow the rental cycle to mirror the structure of the academic year, tenants will be able to serve two months’ notice to end a tenancy. As a result, more purpose-built-student-accommodation (PBSA) operators will likely try and pivot to licence agreements to hedge this risk, but property managers with HMO portfolios will struggle to justify a similar move and will consequently see a portion of their portfolio become available outside the typical rental cycle. As a result, house-hunters may see rents increase in the short term as landlords look to price in potential future increases in void periods and increased costs such as those resulting from council tax liabilities on empty student properties.

Rent shake-up

As was the case with the Conservatives’ Renters’ (Reform) Bill, rent instalments will be limited to one month’s rent, presenting one of the biggest changes within the student sector to both property managers and students. Property managers typically align rent instalments with the release of termly maintenance loans, so students in England and Wales will face cash flow and budgeting pressures unless maintenance loans are migrated to monthly instalments, as is the case in Scotland.

The bill is also set to shake up how rent is typically structured for international students. Most international students are unable to provide a UK guarantor and are therefore required to pay upfront for the year; with this set to be outlawed, we are likely to see property managers expand their use of commercial guarantor services or pivot to using licence agreements where applicable in the case of PBSAs.

Labour’s version of the bill also extends the grace period afforded to tenants for rent arrears to 3 months’ rent, only after which a Ground 8 notice can be served (itself a four-week notice period leading to eviction.) With the prospect of four months of rent arrears before any eviction is effective, property managers will need to reflect on how they appraise the creditworthiness of tenants and guarantors (many property managers in the student sector currently choose not to conduct full references on guarantors) and consider alternatives like commercial guarantor services.

One of the core aims of the bill — and something championed by tenant forums — was, of course, protections for tenants against excessive or punitive rent increases. Unsurprisingly, this provision has been carried forward from the Conservative’s version of the bill. Any rent increases a landlord is hoping to implement will need to be communicated via a Section 13 notice (2-month notice period), with tenants able to challenge the proposed increase in the Tribunal if they feel the new rent is above what the landlord could expect if letting to a new tenant on the open market.

Decent homes for all

The student rental sector has come a long way in the last few years in terms of improving the quality of student accommodation. That said, there are still bad actors renting out unfit properties to tenants, often exploiting the fact that many cities are undersupplied with quality accommodation. Rightly so, the Renters’ Rights Bill will help to root out those landlords by extending the Decent Homes Standard to the PRS, with a new National Landlords Register requiring landlords to register and demonstrate compliance with the Decent Homes Standard. Those who fail to address serious hazards can be fined up to £7,000 and may face prosecution for non-compliance. Awaab’s Law will also be extended to the PRS, ensuring strict timeframes are in place for repairs of health hazards.