What Does the Student Accommodation Landscape Look Like in a Second Wave of COVID-19?
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Whether you’re a University student entering first year or a third year returning to complete your studies, accommodation is a vital part of your experience. When universities closed in March, few predicted that COVID-19 pandemic would also threaten the following academic year, with a second wave now casting considerable uncertainty over student’s plans. To further confuse matters, UCAS reported a 4% rise on confirmed applicants for the 2020/21 academic year across the UK, with many students choosing to delay their entry into an uncertain job market for the security of a university degree . As tougher lockdown restrictions loom across the UK and COVID-19 rates sky-rocket among university students, universities and private student accommodation providers have given little clarity on their plans to safely house students during the pandemic, while the government has been vague on how best to protect universities and landlords from the uncertainty the virus is projected to cause the rental market.
For all parties in the rental market, the prospect of a second lockdown represents a primary concern. According to The Accreditation Network UK (ANUK) only 70% of purpose-built student accommodation (PBSA) is flexible, raising questions about whether students and landlords alike will be protected against costs should a full-blown lockdown be suddenly reimposed. If tenants rush home to their families – or are forced to return home by their university or the government – many lack guaranteed break clause, meaning tenants may be unable to obtain a rent refund from universities or private accommodation as they did in the previous academic year. Similarly, if a PBSA building is completely locked down many questions arise around the degree of support on offer to ensure that students’ food, healthcare and mental health needs are provided for. Equally, locking down entire PBSA buildings while whole floors of the building may be totally clear of the virus will essentially imprison students in halls of residence, preventing access to essential university facilities like the library, begging the question – are halls of residence a wise option for accommodation given the current climate?
It’s important to not overlook the huge impact of international students on the market. Many students were unable to arrive back into the UK for the start of the academic year due to visa delays triggered by COVID-19. National Code have found that many landlords have reported that whilst they’re letting out rooms these rooms are being given back to them, meaning there is a standstill in the market and a backlog is created from landlords having to re-list accommodation on the market. This comes in an age where international students make up a significant percentage of the population across universities in the UK. The House of Commons library reports that in 2018/19 there were 485,600 overseas students studying at UK universities; 20% of the total student population. 143,000 from the EU and 343,000 from elsewhere.
While the Coronavirus Act 2020 landlords introduced considerable protections for students, with landlords forced to give six months’ notice before starting proceedings to evict; the act expired on September 20th and the balance of power has tipped noticeably against renters. Landlords are once again able to progress their possession claims through the courts. If landlords become aware that their tenants are going to struggle to pay rent, they’re advised to contact specialist providers like The Money Advice Service, Shelter and Citizens Advice, but no concrete legislation prevents them from seeking eviction orders through the courts.
Landlords are also protected under government guidelines if a tenant attempts to end the tenancy early. Paralegal at Nelsons law practice – Paula Haverkamp says that landlords are well entitled to make a claim for non-payment rent if a student leaves the property early due to COVID-19 and there was no break clause inserted in the contract. “When renting to students, most landlords will insist there is a guarantor. If this is the case and the student does not pay the rent, the guarantor will also be liable for the rent. If the landlord issues court proceedings and obtains a judgment for the arrears, and the judgment is not satisfied within 30 days, the student and their guarantor will have a county court judgment against them.” If this occurs landlords are entitled to charge a fee, but this can’t surpass the amount of money lost by the landlord on the tenancy agreement.
However, despite all this uncertainty, a number of organisations are working to ease the concerns of renters and landlords alike. Unipol, a charity which helps student’s find housing, are making strides in improve the often fractious discourse between student representatives, landlords and the government, setting up fortnightly zoom meetings between members of the government and the accommodation sector. A range of subjects have been explored in these dialogues, with the next meeting – scheduled for 22nd October – focusing on how the next letting year may be affected and the future flexibility of contracts to ensure the messy start of this academic year is not repeated. As part of the Unipol Code scheme Unipol act as a third-party guarantor ensuring repairs, landlord responsiveness and a complaints process to work out any issues. The government has encouraged both landlords and tenants to seek mediation through third parties like Unipol before taking matters to court, aiming to prevent messy and expensive stand-offs that risk leaving students homeless or landlords out of pocket.
Whilst an unsurprising 89% of students voted in favour of a break clause in their tenancy in the event of a second wave (as reported by a survey undertaken by Moneymagpie), the potential loss for universities and private accommodation providers is unavoidable, worsened by the impact on the market of the uncertainty surrounding international students. It would appear that the government are reluctant to take the same measures adopted during the first wave, further tipping the scales in favour of landlords. Thankfully third parties such as Unipol are offering strong public schemes and mediation is readily available. In such an unstable market it is vital that all parties seek to take advantage of these schemes and make use of all the useful information provided by third parties to cover themselves as best possible.
2 thoughts on “What Does the Student Accommodation Landscape Look Like in a Second Wave of COVID-19?”
As an estate agency owner myself this has been an unprecedented year for us all.
Basically, should the rent be paid? Yes, the mortgage still needs to be paid.
This is the legal position but it is not so simple for anyone. We have seen amazing acts of kindness from landlords and equally we have seen good genuine tenants who just can’t pay their rent. Sadly we have tenants who don’t want to pay and don’t forget we as agents see their reference forms and know where the rent is coming from. We have had to take each situation and look at it and come up with a solution fair to everyone. We have lost out on our fees whilst working doubly hard to find these solutions. We don’t deal with many student accommodation but a friend of mine who deals solely with students has almost lost his business. Universities informed students to stop paying rent immediately which wasn’t good advice.
Let’s hope this vaccine will work it’s magic soonest so we can all get back to doing with what we are supposed to be doing.
Very well written article.