A landlord’s guide to letting to students
Millions of students around the country are packing their bags for the beginning of another term. For many it is the first time they have lived away from home and whether they are moving into student halls or a house share, they no doubt view their new accommodation with a mixture of excitement and dread.
Student tenants are seen by some landlords to carry a higher risk than professionals or older renters, but they can be a great option for landlords. If you live in an area with a high student population, demand and competition is a given, and student lets often produce particularly high yields.
This September, around 2.3 million students are estimated to be moving into private rented accommodation.
If you’re a landlord who’s interested in letting to students, how can you attract them – and how do you keep them?
Get yourself signed up with a specialised letting agent
The process of marketing your rental property to students is largely the same process as advertising any other let.
But there are a few ways of promoting your property to ensure you target students – and signing up to a specialised letting agent is one of doing this. Students are often given a list of recommended agents by the university at around the time they start looking and being on the books of one of these can minimise the time it takes to find good tenants.
In addition, student-centric agents will know the specific ins and outs of renting to students and ensure you get the correct character references and credit checks. These can be trickier to manage as students rarely have a regular income or a lump sum to put down as a guarantee, so they will often require a guarantor, usually a parent or guardian.
The right agent should also ensure you are fully aware of the rules governing different tenancies, whether it’s a house in multiple occupation (HMO), a joint tenancy, sole tenancy or you are simply renting a room to a lodger in your own home. Each type of tenancy has its own rules for both landlord and tenant and it’s important for you to understand your obligations – or risk a hefty fine.
What is an HMO?
An HMO is a property in which five or more unrelated people who share communal facilities such as a kitchen or bathroom, where at least one tenant pays rent live. Many student properties fall under this category and it is vital you have the correct licence as this confirms the property conforms to all the safety standards, including working fire alarms and carbon monoxide monitors. Earlier this year, five Leeds students won £15,000 after taking their landlord to court for not having the correct HMO licence.
Be prepared to furnish the place
Students usually expect places to be fully furnished so your initial outlay could be higher than a usual let. Generally, students are looking for the minimum of the below:
- Washing machine
- Fridge freezer
- Desk and chair for each bedroom
- Vacuum cleaner
Are there any negatives?
Without casting students in a bad light, it’s not unusual for student lets to suffer from more wear and tear, so you may have to spend a little extra time and money at the end of a tenancy. Also, tenancies typically last the academic year, so September to June, meaning the summer holidays will not bring in any income if the tenants chose to stay just the one year.
When do they start looking?
In general students start looking any time from January for lets starting in the next academic year (August/September), although you may find that there are students who have gone through clearing or whose let has fallen through and are looking for last minute accommodation nearer to the beginning of term.
What kind of properties attract students?
Student houses are often social places and can be the focal point of their friendship circle. Larger properties with a minimum of three bedrooms are particularly appealing to students, as are large communal areas, such as a living room and kitchen.
More than one toilet or bathroom will be a selling point, but not usually a deal breaker unless there are more than four people living in the property. But the biggest attraction will be the distance from the university campus – anything less than 30 minutes walk will minimise the cost of getting to and from lectures.
Check your insurance
As students are considered higher risk tenants by some insurance companies, check that you are properly covered if you decide to let to students. If not, you may need to seek out specialised student tenant insurance or buy additional cover from your existing insurer.