Should I rent to students? Advice for landlords
A recent poll by the Tenancy Deposit Scheme (TDS) asked landlords and agents about their experiences renting to students. The poll revealed the top causes of disputes and whether their experiences have encouraged or deterred landlords from renting to students in the future.
There is a general belief within the private rental sector that student tenants may not be the most reliable or responsible of tenants. In fact, some of the feedback TDS received in our recent landlord poll about letting to students , where landlords were posed the question ‘why don’t you let to students?’ included comments such as ‘They tend to be unclean and irresponsible, have too many late-night parties and elements of anti-social behaviour’ but is this really the case?
Turns out that students aren’t that much different to your regular tenants.
The landlords who responded to our student’s poll confirmed the most common causes of deposit deductions were:
- 48% claimed for damage to their property
- 36% made a claim for cleaning
- 9% deducted for redecoration
- 7% experienced rent arrears
Overall, cleaning and damage continually top the list of the most contested issues at the end of tenancy.
The pattern of disputes in all private tenancies - including student lets - has continued to follow the same trends over the past 5 years of publishing our insight reports.
A higher number of deposit deductions?
The poll results did reveal that a higher number of landlords submitted a deposit deduction at the end of tenancy for student lettings.
In total, 88% of respondents confirmed that they needed to raise a deposit deduction, which is higher than average.
However, when considering the higher turnover of tenants in a student let, shorter tenancies, and a larger number of tenants within the property, the reasons for this may not be down to an irresponsible student tenant, but many other varying factors.
A real-life student dispute case study
A landlord submitted a claim deducting for cleaning costs at the end of tenancy, which the student tenants contested.
The tenants said they had cleaned the property before they moved out and left it in better condition than when they moved in. However, they did not provide any evidence to demonstrate that.
The landlord’s evidence
To support the claim, the landlord offered:
- A copy of the tenancy agreement.
- A detailed check-in report - including a summary schedule of condition of the property and contents at the start of tenancy.
- A check-out report showing discrepancies between check-in and check-out; and
- A detailed quotation from a cleaning company referring to the cleaning deficiencies noted at check-out, plus the time spent by the cleaner to carry out the work.
The outcome
The adjudicator compared the reports and confirmed that the cleaning claimed at the end of the tenancy was justified. As the property was shown to be professionally cleaned at the start of the student let, a full award was made to the landlord for the amount claimed, which was supported by the cleaning quote, and found to be reasonable.
The lessons
The takeaway here is for landlords to ensure they have detailed reports and evidence for each stage of the tenancy to demonstrate any change in condition and work required.
Before you make a dispute claim, try our Dispute chatbot to check if the claim you are making or the evidence you have are valid.
Landlords have found that our deductions template is valuable in explaining to your tenants why the deduction has been made and helps to avoid deposit disputes.
You can find more interesting case studies, tools and templates in our Information Lounge.
Some of these resources are only available to landlords who use the free deposit protection scheme at TDS Custodial or the insured scheme at TDS Insured.
So, do the benefits outweigh the negatives?
Overall, 86% of landlords and agents who responded to our poll agreed they would continue to let to students in the future.
With over 2.6 million students in higher education across the UK, higher rental yields and a stream of student renters in university towns, there is no question that the student housing market is still a great opportunity within the PRS.
And what about the latest Government White Paper proposals?
These plans are already causing a stir within the student landlord market thanks to the proposed removal of fixed term assured shorthold tenancies, potentially being replaced by periodic tenancies.
This proposed change will impact landlords abilities to get their property back at the end of the academic year and allow students simply to leave with just two months notice.
However, the White Paper did confirm that purpose-built student accommodation would be exempt from these proposed changes and tenancies in that sector will instead continue to be governed by the Protection from Eviction Act 1977, so long as the provider is registered for a government-approved code. But most students are not living in such accommodation, so there will no doubt be a lot more discussion with the Government about the possible damaging impact of this change for landlords who are housing students.
Student Lets Guide for Landlords
In partnership with NRLA, TDS has created a Guide to Student lets, detailing what you need to know about the student rental market.
Download the guide here.
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Alternatively, you can use the tenancy deposit scheme through your NRLA membership. NRLA members receive leading tenancy deposit protection rates with TDS, too! If you are not yet a member of the NRLA, CLICK HERE to join and receive £15 off membership.
