England’s big student housing shakedown

Rory Hughes is a housing policy and campaigns consultant

At Membership Services Conference 2023, I had the privilege of running a session looking at all things student housing policy in the 2023/24 year – and how to influence it.

In the session, we focused on the Renters Reform Bill (RRB) “student exemption” debate, the issue of housing supply and regulations across the UK, and concrete opportunities for influencing housing policy.

Renters reform bill

The RRB is currently stuck in recess, which is frustrating when estimates calculate up to 90 people are being evicted every day.

However, this delay has given the student movement a greater opportunity to influence when the Bill (hopefully) returns in the Autumn.

I continue to support NUS in influencing the RRB, and noises coming from DLUHC suggest that the political will to introduce a “student exemption” to the tenancy reforms (basically keeping students on fixed-term tenancies) is growing – although it seems like no material work has actually been done on how this would function.

The proposals for a student exemption remain underpinned by a false idea of how all students in the PRS. This can be summarised as all students being young people living in large all-student shared Houses of Multiple Occupancy (HMO) properties, in “studentified” areas of major cities.

They change term-time home every year and prefer to sign tenancies many months further in advance of occupation than other tenants. They do not want tenancy security and they return to their parental/guardian homes regularly, including for months over the summer.

The properties they live in never move back and forth between student and non-student tenants.

In the session we discussed how policy-makers need to be made more-aware of the diversity of students’ living situations in the PRS. There are tens of thousands of students who view their PRS property as their primary, multi-year residence.

We know this because NUS and SOS-UK have completed research through surveys of student renters for over a decade in the Homes Fit For Study series.

In 2023, the research found that:

  • 61% of students in the PRS lived with people unrelated to them and 27% of these students lived in mixed student/non-student households
  • 23% lived only with their partner
  • 11% of students lived alone
  • 8% lived with dependent children under the age of 18.

In 2019, the research also found that 40% of respondents only lived with between 1-3 people and as a result, many of these homes would not even qualify as HMOs.

In 2018, the research found that many students do not see their PRS housing as transient at all, 30% of respondents said their current rental property was, “like the accommodation I can see myself living in in the future” and 62% said it was, “somewhere I think of as home”.

In 2014, NUS’ research found that 27% of surveyed student renters selected, “Tenancies without fixed terms which would allow tenants to stay for as long as they need” as their preference for a top policy priority for NUS.

In 2019, when asked about things that would improve their experience of renting, 63% of respondents chose, “the use of open-ended tenancies as opposed to fixed-term tenancies” and in 2023, only one third of respondents said they would not be likely at all to continue staying in their accommodation if they were offered greater security of tenure.

We also spoke about how SUs, in particular advice services, could help supply policy-makers the case studies that tell human stories of who these student renters are.

Whether they are the 13,183 students that the Student Loans Company identified as Care Leavers or Estranged from their families in 2021/22, or the 300,500 full-time students over the age of 25 HESA identified in 2021/22, or the thousands of trainee teachers and healthcare students on placements hoping to work in their local community for years after graduation.

Students as 2nd-class renters

Having been monitoring APPGs, Select Committees and Parliamentary debates I have seen how many MPs and lobbyists continue to assert that students shouldn’t worry because if they are kept on fixed-term tenancies, that is the only “right” they would be forfeiting and they would benefit from the rest of the RRB.

In the session we explored how this is categorically false.

Firstly, the removal of annual no-fault evictions is not just about security of tenure, it is also to ensure tenants feel confident raising issues with their landlord without fear of eviction or rent-hikes and to prevent the hassle and cost of frequent moves (e.g. with tenancy deposits).

Under the student exemption proposals, the same fear of eviction when raising issues to the landlord will continue to exist for students.

NUS’ research in 2023 confirmed that common reasons as to why respondents didn’t approach their landlords regarding repairs and standards was for fear of evictions or rent rises. Students remaining on fixed-term tenancies will ensure they remain disempowered and housing standards remain low.

Secondly, the vast majority of rent control measures rely on controlling within-tenancy rises (being more politically and logistically viable).

As such, were students to forever-remain on fixed-term tenancies, such controls are unlikely to ever benefit them. In the RRB proposals, there are rent-stabilisation proposals within the periodic tenancies.

Rents will only be able to rise at the “market rate” annually – and proposed rents will be challengeable by tenants in a Tribunal. If students are exempted from the tenancy reforms, they are also exempted from this process, left at the whims of uncapped annual rent increases.

In Scotland, their current rent caps have controlled within-tenancy increases to 3%, but between-tenancies rents have shot up by more than 10% on average (luckily students retained security of tenure there).

To hammer this message home, the Scottish rent caps for Purpose-Built Student Accommodation (PBSA) have specifically been suspended because, due to the fixed-term tenancy churn, they were having no impact (and as such PBSA rents continue to rocket).

Finally, were this distinction between student and non-student renters to be introduced into tenancies in the PRS for the first time, we discussed how this could set a precedent for further future policy divergence between the two.

For example, what is to prevent lower housing standards being required in student homes compared to others in the PRS on the same basis of “population transience”, or it being a “distinct sector”?

Do we get nothing in return?

Policy-makers and lobbyists have also been arguing that because PBSA tenancies will already remain fixed-term after the RRB becomes law, there is already a “2-tier” system and the student exemption proposal just brings the student PRS into-line with that.

We discussed how facetious this argument is. The student movement has supported PBSA being exempt from indefinite tenancies both in Scotland and England.

PBSA and the PRS are qualitatively and legislatively (e.g. in planning and tax) different sectors, and having non-students living in them would violate these other aspects of legislation. On a practical level, nobody wants non-students living in PBSA permanently alongside students.

Furthermore, even taking the argument on its own merits, students receive a significant amount of additional benefits from PBSA in return for this flexibility that the PRS does not offer.

For example, there are dedicated Government-approved Codes of Standards, greater levels of professionalism and staffing, closer formal links to their university and additional amenities.

We discussed in the session how if tenancy laws in the student PRS are to be brought more into-line with PBSA, a discussion about what students would get in return needs to be had.

Supply, demand and regulations

After that, we moved onto discuss how the supply/demand crisis is impacting discussions on tenants’ rights and what we should do about it.

The crisis has spurred-on the exemption-idea in the RRB, but is also being used to attack other housing proposals in Wales, and Scotland on the basis that any more regulation risks exacerbating the crisis.

It is now clear that there is a universal issue with supply/demand imbalances in the PRS, with every demographic (not just students) and in every UK nation (with different PRS systems).

There are myriad reasons behind it on both supply and demand-sides.

It does appear that some landlords are selling some properties. Operational profits for some landlords have been hit by:

  1. Changes in tax policy on rental income
  2. Inflation in running costs (e.g. energy and maintenance)
  3. Interest rates hitting buy-to-let mortgages

During the pandemic there was a substantial drop in demand in the PRS (as people including students moved back in with family, or delayed moving out) and a very hot housing sales market. Demand grew from people saving money, wanting more space and control over their housing and stamp-duty tax incentives – increasing house prices. A massive windfall for landlords selling their properties continues.

Another factor is that an ongoing boom in UK tourism, spurred-on by Covid, and now it seems climate change, has meant some PRS properties have been flipped into Airbnb markets.

On the demand-side, those living with family during the pandemic have since joined the PRS, Generation Rent puts the figure as high as 300,000 additional renters.

In addition, clearly high net migration and spikes in university recruitment have had an impact.

Finally, the all-important question of regulation. Regulation ramped up (often temporarily but significantly) on the PRS during the pandemic, there is increasing media-focus on the area and the writing-on-the wall in all four nations of the UK is there is more coming down the line.

This may be continuing to influence some landlords decision-making, but given the universality of the crisis across nations with very different housing policies, this seems like a secondary driver.

Furthermore, as a general precedent, this hasn’t driven supply shocks in the past. The Westminster government’s own impact assessment on the RRB said:

The available evidence to date strongly suggests that similar reforms to abolish section 21 in Scotland have not impacted supply, nor changes introduced by the 2019 Tenant Fees Act, despite concerns that they would. The most recent English Housing Survey data shows the proportion of PRS households has remained relatively stable since 2013-14, suggesting that there has been no significant impact on supply to the sector from various reforms. Of those PRS properties that are sold, there is the potential to see the replacement of rogue landlords with those who are more professional and tenant-focused.”

Scottish Government has also recently said regarding its rent cap proposals that, their landlord register shows that “there is no strong empirical evidence at present to substantiate the anecdotal claims from some that landlords are leaving the sector.”

Three things become clear at this point.

One, supply seemed like a student-specific issue because students were the canaries in the coal-mine of this crisis who, due to the coordinated timing of their annual migrations, experienced it first and at-scale.

However, I am yet to see compelling data that shows that the supply/demand experience for students in the PRS is qualitatively worse than other renters. As such, proposals to weaken students’ rights specifically to deal with this supply-crisis are flawed.

Two, landlords across the nations are using this crisis as an opportunity to turn the tide on new regulation – from the RRB in England, to rent control proposals in Wales and Scotland.

Three, there is a chance that additional regulation, such as the RRB, will exacerbate supply issues. However, even if all new regulations were abandoned (or students were exempted) the crisis is already here to stay.

So all organisations representing renters are trying to weigh up is either:

  1. To regulate and empower tenants whilst also looking at policy solutions to the ongoing supply crisis
  2. To abandon regulations in a hope that it will stem the issue

A holistic approach to supply

In the session, we discussed what serious policy proposals to address the supply/demand imbalances would look like.

Clearly, we need better data and one vital mechanism is the existence of a universal landlord register. This already exists in Wales and Scotland and is part of the RRB proposals.

Ensuring that these registers collect information on whether the landlord is letting to students, and on the PBSA sector, would make a substantial difference to our analyses.

Central and local government need to bring together stakeholders to martial this data into action on both supply and demand.

On supply, we need coordinated action to address the collapse in PBSA development since the pandemic, which has occurred despite high-demand – with building regulations and financing bigger issues than tenants’ rights or standards.

We need coherent plans for the identification and purchasing of PRS properties if/when student landlords do decide to sell. Universities, local authorities, housing associations and even student co-ops could all be empowered to buy or head-lease these more proactively. We have seen early proposals for this (not specifically for students) in Scotland, Greater Manchester and from a range of think tanks.

In addition, new regulations to monitor and prevent homes being flipped into Airbnbs are sorely needed.

We also need to join-up with allies across the housing sector who themselves are crying out for long-term housing supply strategies. Take my old employer, the National Housing Federation (that represents housing associations), their priority is a long-term plan for social housing. One sure-fire way of boosting PRS supply for all, is mass social housing development to relive pressure.

Clearly both parties are increasingly amenable to these kinds of discussions, with Michael Gove and Labour making housing supply a bigger part of their offer.

And on demand, serious strategies regarding university recruitment and housing supply need to be created.

Let’s get some quick wins under our belt

We finished the session by whizzing through some other key housing policy areas in 2023/24.

In the world of the RRB this Autumn, we should get sight of the delayed PRS Decent Homes Standard which will be ripe for scrutiny. As part of a combination of successful landlord lobbying on the supply-crisis and Rishi Sunak’s new ULEZ-fuelled bonfire of climate policy, it also looks like the government’s proposed Minimum Energy Efficiency Standard regulations for the PRS are-set to be watered down – tragic for both student tenants and the environment – and worth fighting.

Concern has been raised about the interplay between the RRB’s indefinite periodic tenancies, and joint tenancies in HMOs (because one tenant could end the tenancy for everyone in the house).

The student movement should consider simply pushing for joint tenancies to be abolished through the RRB – or giving HMO tenants a legal right to choose which type of agreement they want. Forcing individuals who don’t know (or owe) each other anything into joint and several contracts is already an issue, and individual tenancies would function perfectly well for all with some minor tweaks.

Shelter is leading an excellent campaign to make the use of guarantors, upfront rent and tenant discrimination illegal. Their proposals have recently been backed by other groups. Nobody has brought the benefits these reforms could bring to international students into play yet, something the student movement could jump-on as part of the RRB. It seems Westminster is also keen to work across the nations on this aspect of the Bill.

The RRB has specifically left a legislative door open to the creation of a PBSA-focused landlord database and redress scheme (paragraph 172 here) – the movement should begin to actively consider how this could work-best for students.

And finally, the RRB looks set to create another stick (in the form of requiring membership to gain tenancy exemptions) to prod PBSA providers into becoming members of one of the three government-approved Codes of Standards.

These Codes are a vital regulatory mechanism in the sector and both the Codes that cover the entire university-sector in England, Wales and Northern Ireland are in the process of being overhauled.

Students’ Unions can respond to the public consultation on the Code operated by UNIPOL until the 13th September. It features a swathe of new proposals, from overhauling fire safety requirements, to lowering rents for disabled students, to financial compensation for students impacted by late development of buildings and unmet accommodation guarantees.

I am also the lead consultant currently reviewing the UUK/GuildHE Code and I updated attendees on how they could input into the process and how to contact me for further discussions.

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