With more than half of young people now going to university in the UK, it’s little wonder why so many landlords are turning their attention towards the student population. Not only can you enjoy guaranteed annual income from tenants, but you’ll benefit from renting to multiple occupants, charging increased rents in high-demand areas, and reduce the chances of letting to those nightmare tenants who trash your property and fail to pay their rent on time.
Below, we’ve put together six things to think about before you start renting to students…
First up, it’s important to note that renting to students is not all that different from renting to your average tenant. You’ll need to adhere to all of your typical landlord responsibilities, like deposit protection schemes, fire safety regulations, and gas safety. You must also check the immigration status of your tenants before you let to them, and conduct an affordability check; or, at least, ask for proof of a loan or their financial support from the bank of mum and dad!
Next up, you should take into account antisocial behaviour. As a landlord, you have a duty to stop tenants from acting antisocially, so if you rent out your property to a bunch of students who have late-night parties and forget to put out the recycling bin, you’ll need to take action.
Of course, you can turn to the council and perhaps even the students’ university, but it can have an impact on your reputation as a landlord or property management company, and other tenants living in neighbouring properties, so enforce a strict antisocial behaviour policy.
Something to bear in mind is that students are exempt from council tax, but they’ll need to apply for an exemption certificate before their tax is waived. You must be able to prove your property was occupied by students, or you could be liable to pay a council tax bill, so keep documentation on file and verify that your tenant is actually a student before letting to them.
One of the biggest benefits of renting to students is that you can easily convert your three and four-bedroomed homes into ‘houses in multiple occupation’ - also known as HMOs.
In short, this means you can split the risk from one tenant renting out your property to three, four or five people - that’s five separate payments per month, meaning if one went AWOL, you’d still have four tenants providing a reliable rental income. Note that you may need to apply for an HMO license if your building is three storeys high. The administration associated with five separate tenants can also lead to additional time and costs; something to consider.
The chances are that your student tenants aren’t going to be moving in with a grand piano and a corner sofa, so furnishing your property before you rent it will make it more attractive - and allow you to increase your rental income. You don’t need to spend a fortune - once you have covered the white goods, head to IKEA to buy some beds, chairs, tables, and sofas, and make sure you conduct a full inventory so tenants leave your furnishings in good order.
Finally, you should think about marketing your property to students. Enlist a local lettings agent or work directly with the university to find reliable tenants. Bear in mind that, once you have found your first tenants, they’ll likely want to stay on for their second and third years of university, and bring their friends if a room becomes vacant. What’s more, if you’re a good landlord, word of mouth marketing will help you to fill your property in future academic years.
If you’re operating in a particularly competitive student city, you might want to consider offering an all-inclusive service to student tenants, covering all of their household bills under one monthly package. Partnering with Billing Better makes this possible, and you can even earn a commission of £20 per property per month as a thank you for your recommendation.
We hope that this article has given you some food for thought, and helped you realise that the student accommodation market can be highly lucrative. If you have any questions, don’t hesitate to reach out to the team; and be sure to check back soon for more landlord advice.