Chaos is coming for student renters in England

Key provisions include abolishing Section 21 “no-fault” evictions, banning rental bidding wars, allowing tenants to request permission to keep pets, a Private Rented Sector Landlord Ombudsman and the application of the Decent Homes Standard to ensure quality living conditions.

In its current state, though, there are multiple issues that could well cause chaos in the student part of the Private Rented Sector (PRS) – so it’s now on peers to do their revising bit to avert some of the chaos.

NUS has been campaigning to ban landlords from requiring a guarantor – but the government’s position remains that guarantors can provide landlords with assurance to let their properties to tenants who may otherwise find it difficult to access private rented accommodation. At third reading Housing minister Matthew Pennycock said:

I appreciate fully that obtaining a guarantor can be difficult for some prospective tenants, and I understand the reasoning behind his amendment…. [but] for example, there are those with a poor credit history—the kind of tenant who the shadow Minister worries our rent-in-advance amendments will harm. Having considered this issue in great detail, I ultimately concluded that limiting guarantors could inadvertently make life more difficult for certain types of renter.

It’s also banning the collection of more than a month’s rent upfront or during a tenancy, and giving all tenants the right to bring a tenancy to and as long as they give the landlord 2 months’ notice.

As such, the interesting question is what happens now.

Because guarantors are only really “guarantoring” 2 months rent they might not bother. They could still insist – pushing costs even higher for international students who may need to use one of the commercial insurance style schemes. They could just outright discriminate against international students.

Because the “guarantee” only need be for two months not 12, more universities are likely to move into offering guarantor services as competitive advantage – but not all universities will have the finances to do so.

Meanwhile student landlords will gain the right to evict HMOs of students over the summer. Which doesn’t really work for those on longer academic years or Jan starts.

Worse still, landlords are panicking that students will quit their tenancy in March, so they can move out in May and avoid paying rent over the summer – so many are chattering about moving their start dates back to June so they can still trouser the summer rent. Which as I say, will screw plenty of students that are still around in June.

Under the new law, landlords will only be able to put the rent up once a year and only then if it’s not going up by more than local market rates. But that applies to tenancies not properties – giving them a deep incentive to evict in the summer and then yank the rent up, even if a student or group of students wants to stay on.

Under the new rules, the lack of ability to pay rent termly will exacerbate home student hardship at the end of each term – because unlike in Scotland, they can’t pull down their maintenance loan monthly.

In addition, a student landlord (wanting to reserve the right to evict in the summer) won’t be able to sign a tenancy until 6 months before it starts. If, say, the general tradition in your city is September 1st starts, March 1st will be chaos – queues around the block all weekend, sleeping bags, students in work or on placement in a pickle.

And that will drive the incentive to move the contract date earlier so the property is let earlier. If they push back to July 1st, expect sleeping bags near tenant agencies on New Year’s Day.

Under the new rules anyone in a joint tenancy will be able to bring it to an end without even telling the others. There’s a “notice” fix in the Scottish Housing Bill. There’s nothing in the RRB.

There’s a new ombudsman coming for bad landlords. Do you reckon it’ll fast track student complaints? No. Why is that a problem? Because students tend to move out at the end of the year, and landlords gain the right to evict them in the summer.

As I say, tenants gain the right to cancel a contract on two months notice. But only once the tenancy starts – so a student who fails the year still has to pay two months rent!

Is there anything in there on all inclusive bills deals with small print that means they’re anything but? There is not.

Is there anything in there on huge deposit deductions that don’t actually then get spent on fixing whatever issue the landlord says there is? There is not.

Is there anything in there stopping a university from recruiting thousands of students who will have no reasonable chance of renting somewhere affordable, safe, and of a reasonable distance from campus? There is not.

Anything giving OfS the powers and duties over housing envisaged in the Augar review?

The public subsidy of student maintenance, much of which is spent on accommodation, gives the OfS a legitimate stake in monitoring the provision of student accommodation in terms of costs, rents, profitability and value for money. The government should also provide a clearer picture of private sector involvement in student accommodation by commissioning a comprehensive financial analysis of private developers and operators of purpose-built student accommodation to understand the profits that private business and investors are making from student rents.

There is not.

There’s a clause in the Bill that prevents landlords from discriminating against people with children and people on benefits because they are vulnerable but not protected characteristics under EA10:

The rental discrimination provisions in the Bill are specifically designed to protect victims of discrimination who may not be eligible to make a case under the Equality Act 2010, such as those who have children or are in receipt of benefits.

Yes, they’ve done the usual thing of forgetting that students are just as economically precarious, but because they get loans via DfE instead of benefits from DWP, they get no protection.

The transition will be fun. The Bill abolishes fixed-term assured shorthold tenancies (ASTs) and requires all assured tenancies to be periodic with rent periods not exceeding one month​. Students will therefore ask – what happens to their fixed-term tenancy due to start in September signed before the law changes?

Existing fixed-term tenancies will still be valid, meaning if they signed in January for a September start, the contract still holds. But once the tenancy starts, the Bill automatically converts it into a periodic tenancy with a maximum rent period of one month​. If they’ve paid a good wedge of rent upfront, their landlord would have to return it.

And of course there are no new rights for students in purpose-built student accommodation at all. Should a student rent a room in halls? There’s no way I’d advise it given the different rights. The Bill as it stands could see students piling into houses rather than PBSA, pushing rents up and making renting even more unaffordable to them and locals in the process.

That surely wasn’t the intent.

Pretty much none of the above in the “impact” assessment – HCLG tends to think that student tenants are DfE’s problem, and DfE appears to think they’re MHCLG’s problem, so it doesn’t look like anyone has lifted a finger on some fairly straightforward scenario planning.

What is clear is that the RRB in its current state means there will be bedlam over the next couple of years, and that will hit students – especially international students – hard. Hopefully the Lords can apply some sensible fixes.