In the manifesto, Labour’s “opportunity mission” was supposed to support the aspiration of every person who meets the requirements and wants to go to university.
It also pledged to act to improve access, create a higher education funding settlement that works for students, and strengthen regulation in their interests.
So you may be surprised to learn that the square peg of reforming the law for tenants in the private rented sector has been wedged into the round hole of this mission.
But the background briefing for the Renters’ Rights bill – a rebadged version of the last government’s Renters (Reform) Bill – says that the insecurity embedded in the current tenancy system fails tenants and acts as a “drain on aspiration”, so much so such that reform of it is central to its opportunity mission, so that “all have the chance to achieve their potential”.
The opportunity mission framing is fair enough. In 2022/23, HESA says that over 1.3m students lived in the private rented sector – and given the inflexibility of which boxes a student can tick, likely excludes commuter students in the parental home whose parents rent.
I need not repeat here the myriad studies, stories and anecdotes that concern the state of the student rental market – a subset of the private rented sector plagued by black mould, unscrupulous landlords, skyrocketing rents and rights that students can’t enforce.
So given how “central” this all is to Labour’s opportunity mission, the question is whether the newly revised proposals have both addressed the issues in the last version for students, and centred them properly in any changes.
And I have bad news.
Will it work for students?
Renters will get the right to exit a property on two months’ notice – solving the problem of students signing early in tight markets and being trapped. Unless they opt for halls, where neither that nor most of the other rights in the bill will apply.
They’ll also get tenancies that continue indefinitely – unless they’re students, where landlords will be able to evict them in the summer. That won’t work for January starts, plenty of PGRs and local singles who decide to become students and lose their rights to tenure in the process. And it could cause chaos for those in joint tenancies – given one person in one can trigger it.
Tenants will be able to challenge above market average rent increases. That won’t work for students, whose now mandated cyclicality will continue to enable landlords in their part of the sector to jack up the rent for new tenancies every year.
The bill will ensure that landlords can take possession of a property if the tenant has engaged in “anti-social behaviour” – but what will stop that power being abused by student landlords, and whose standard for what counts as antisocial will apply – the average student, or the average retired couple?
A new Private Rented Sector Landlord Ombudsman – which will supposedly provide “quick, fair, impartial and binding” resolution for tenants’ complaints about their landlord – will only work if it has a fast-track option for student complaints – given the likely and now mandated average length of their tenancy. No mention of that now.
A new “Decent Homes Standard” will apply (that may well end some of the scandals that surround safety), and there’ll be a new right to have pets in a property. But measures in the last parliament’s amended version of the bill which would have limited the amount of rent a landlord requires to be paid upfront – a tactic many landlords use when a guarantor is not available – have been dropped.
As I say, pretty much none of this will apply for students in Purpose-Built Student Accommodation – odd when the government says that in general, the new tenancy system will have be used by other landlords currently outside the private rented sector – including private registered providers (PRPs) of social housing (typically housing associations) and providers of supported accommodation, as well as landlords providing temporary accommodation to homeless households. So why not students?
The rule will be that Purpose-Built Student Accommodation (PBSA) will be exempt from these changes “as long as the provider is registered for government-approved codes” which are run by Unipol and are supposed to provide redress. Anecdotal evidence and recent press coverage suggests that they are not working.
The government should obviously just standardise so that all students get the same tenancies and rights as others – regardless of whether they’re in halls or private houses. Especially given the rents students pay and the profits that are made in halls.
What’s missing
What we’re left with, then, is a bill that was never written with students in mind that contains some fixes and bodges designed to address the concerns of their landlords. In essence, Labour has picked up where Michael Gove left off – which might be fine framing on the headlines, but completely ignores the needs of students in the process.
There are so many things that could be done to make renting better for students if someone sat down and thought about it. The government could look at the way international students tend to be discriminated against, tackle landlords demanding a year’s upfront rent, address the issues faced by those forced into joint tenancies, and make the right to both cancel and stay on universal.
It could do what Ireland has just done and stop students being forced into 12 month contracts when they only need nine. It could address “all inclusive bills” scams where students think they have gas and electric covered, only to find that “fair use” policies are anything but – with no ability to force their home to be energy efficient. It could address the lack of reasonable adjustment in the private rented sector for disabled students, make landlords actually fix the things they charge for in deposit retentions, and ensure that students are protected from skyrocketing rents.
Of course if housing really was central to the opportunity mission, there would be a proper national student housing strategy – as there is in pretty much every other European country. Stimulating supply, giving new powers to local authorities and aiming at homes that are above a minimum standard and at one suitable for study hadn’t ought to be beyond our reach.
Above all, students need somewhere to live that’s near to campus, safe, suitable and reasonably priced. As I’ve argued on here before, if you’re a university that recruits a student living away from home and you don’t know if they’ll be able to access such a room, that’s irresponsible. If you do know, that’s outrageous. It should be a central aspect of higher education regulation that you do know – prevented from recruiting additional students if there aren’t the suitable beds to sleep in.
What should happen next
There’s a kind of inevitability to the disappointment here – we’ve talked on the site before about the way in which, when a question over student housing comes up, the housing department tends to point at the Department for Education (DfE), DfE tends to point at the housing department, and both point at vice chancellors and local authorities when they’re out of options.
That was reflected in a Renters (Reform) Bill that hadn’t properly considered those 1.2m renters at all in its original version, with bodges to address concerns from the landlord lobby in some ways making things worse.
But the whole point of “mission-drive government” was to break down departmental silos and ensure cross-government working to avoid situations like one department being responsible for housing and another for students never meeting when the venn diagram has a huge wedge of citizens in the crossover.
Maybe here in the early days of a government the failure to do that is allowable – but the mission board should set about fixing that right now.
The bill is in still its infancy and will probably see a number of changes as it works its way through Parliament. To play devil’s advocate for a moment though, what do you think will happen to rents if landlords are no longer guaranteed a 12 month minimum term? Do you think they will sit on their hands and accept, at best, a probable two month void period each year during which they will still have to finance the running costs of a property (mortgage, utility bills, council tax that will become due if the property is vacant)? Or will they do one of the following:
1. Increase rents to account for the anticipated void periods to maintain the same annual income, i.e. 12 months’ rent to be spread over 10 months; or
2. Pivot to professional lets which are just as profitable but have none of the drawbacks of letting to students (it is almost impossible to fill empty rooms in a student let once term has started – this is not the case for professional lets which see consistent demand throughout the year). This will reduce the supply of off-street student accommodation and push up rents for those that remain; or
3. Sell up and move on to another class of investment (shares, commodities, business) that is less of a headache. Again, this will reduce supply and push up prices.
Students will be faced with even higher rents, fewer properties to choose from and, in some areas, a choice of PBSA or PBSA, which is significantly more expensive than off-street student housing.
Landlords are not trapped in the student rental market; it is a business like any other and if becomes unprofitable they will simply move on to other sectors. The government obviously realise that the student market is its own niche with its own requirements which is why PBSA providers will continue to be able to grant fixed term tenancies. The maths doesn’t really add up for investors without that certainty.