UK: Letting To Students – Tenancy Types And General Guidance

Last Updated: 10 March 2009
Article by Tessa Shepperson, BA, LLB, Solicitor

Introduction

The student market is an important part of the lettings industry and many landlords specialise in lettings to students. Students are generally good tenants. Often large chunks of the rent are paid in advance, and their parents are generally willing to stand guarantor. Many landlords on college accommodation office lists will have all their properties let within days of details being made available.

But are there any differences in letting to students as opposed to other lettings?

This article takes a look at the different types of student accommodation, and then considers what special legal situations may be involved in student lettings. It will be useful for both landlords and student tenants.

The different types of occupation

Before looking at student accommodation in detail, let us look at the different types of letting which can apply to students:

Licenses

This is where a person has permission to live in the property, which prevents him from being a trespasser. His rights will mostly be limited to what was agreed with the landlord, and some of the rights enjoyed by tenants (most importantly the landlords repairing obligations as set out in section 11 of the Landlord and Tenant Act 1985 (s11)) will not apply. The landlord is still bound by the Gas Regulations and the Furniture regulations. However any deposit taken will not need to be protected in one of the tenancy deposit protection schemes (TDPS), as these apply only to Assured Shorthold Tenancies (ASTs).

There are two types of license:

  • Where the landlord lives on the premises (where the occupant is generally known as a lodger), and
  • Where the landlord does not live on the premises

The main significance between these is that if the landlord shares essential living accommodation with his lodger, he does not normally need to obtain a court order for possession.

Tenancies

This is where the tenant, in effect, 'owns' the property for a period of time. Tenancies come with various important rights, the most important of which are the right to have the property maintained as set out in the repairing obligations in s11, the right to occupy the property without disturbance by the landlord (sometimes called 'the covenant of quiet enjoyment'), and the right to stay in the property until evicted under a County Court order for possession.

There are two main types of tenancy which will apply in student lettings:

  • Assured Shorthold Tenancies (ASTs), and
  • Common law tenancies

ASTs are tenancies where the protective code set up in the Housing Act 1988 will apply and where the landlord will have to comply with the terms of the act, for example when evicting the tenant.

Common law tenancies are where the Housing Act 1988 does not apply, and the tenancy is therefore governed by the underlying 'common law'. Only deposits paid by AST tenants need to be protected under the TDPS.

For more information regarding the law relating to common law tenancies and ASTs see the Landlord-Law web-site (e.g. in the Legal Information section).

Note that although it is possible for students to have accommodation rented to them by a Local Authority or other social landlord, this is not usual, so these tenancies are not considered in this article.

Different types of student accommodation

Halls of Residence

Most universities and colleges are able to provide accommodation for their students, at least for the first year. This will typically be a study bedroom with communal washing and kitchen facilities or (in the more modern accommodation) a study bedroom in a shared flat. Most accommodation is now self catering although some, perhaps the more old fashioned, colleges will provide meals and cleaning services.

The exact legal status of the student in this accommodation will depend on a number of factors, as follows:

  • If the student has 'exclusive occupation' of his own room, this will generally be a tenancy. If he shares a room, e.g. with another student, this will normally be a license.
  • However if services are provided (e.g. meals, cleaning etc) the occupation will almost always be a license, even if the student has his own room
  • If the student has a tenancy, then if the landlord is the same college or university which is providing his education course, the tenancy will normally be a 'common law' one.
  • If the landlord is not the students own college or university (for example if the accommodation is provided by a specialist student accommodation company, such as Unite) then any tenancy will be an AST.

Dual Role of Universities & Colleges

Although in most cases, there is, on the whole, no difference between a student tenant or any other tenant, and the colleges role as educator and landlord are entirely separate, in some of the older, traditional colleges, this may not be the case.

In the past many colleges have often sought to argue that a student is part of an academic community or 'club' and that the student will be able to challenge decisions made by the college via the internal procedures only. As these procedures were not always wholly transparent, this led to the setting up of the Office of the Independent Adjudicator for Higher Education (www.oiahe.org.uk). It is believed though that for accommodation matters the student should also be entitled to have recourse to the normal courts.

However where the college is a chartered corporation, it has been argued that students (like the University staff) are members of the corporation, and that in this case only the internal procedures will be appropriate. This may or may not be the case.

For a more detailed discussion of these matters (including whether colleges and universities are entitled to enforce debts by academic sanctions), see the excellent 'Student Housing and the Law' by Martin Davis and Graham Robson, published by Shelter.

Bookings via the internet

If student accommodation is booked via the internet (as is common with the large specialist student accommodation providers) this is one of the few situations where students will be entitled to a 'cooling off period' of seven days after confirming their booking, under the Distance Selling Regulations. In virtually all other situations, a tenancy agreement is binding on the tenant before the ink is dry on the paper, and if a mistake is made, it may be difficult to cancel. Students should be careful therefore never to sign a tenancy agreement unless they are really sure they want to rent the property.

Other accommodation owned or managed by the University/College

For example other houses or flats rented to students and their families. Again, if the tenancy agreement is with the students own university or college, the tenancy will be a common law tenancy. Otherwise it will be an AST.

Lodgings

This is where the student will rent a room in someone's house. Invariably they will share some living accommodation with the owner and his or her family, bed linen is generally provided, and often cleaning and meals also. As indicated above the student will be a licensee / lodger.

In many cases the arrangement is fairly informal and frequently there will be no paperwork at all. If the parties understand and trust each other, there is no reason why this should not work perfectly well. However as even the friendliest of situations can sometimes turn sour, it is advisable for both sides to sign a written agreement, or at the very least have a letter setting out what has been agreed.

Lodger agreements can be downloaded from the Landlord-Law site, and forms can also be bought in many large stationers.

For more information about lodgers, please see the tips and FAQ in the Resident Landlords information section on Landlord-Law.

Renting in the private sector

Many students, particularly after their first year at college, will decide to rent a house or flat in the private sector, frequently with friends. Many landlords specialise in renting property to students, and will generally be registered with the University or College accommodation office.

Students are advised to look for accommodation via their accommodation office list as the landlords will normally have been vetted and will generally have to comply with higher standards than the legal minimum. Also landlords will be keen to stay on the accommodation offices books (as this is where they will get the majority of their tenants) so any complaints sent to them via the accommodation office will be taken very seriously.

In many areas there are special landlord accreditation schemes often run in association between Local Authorities, Colleges and Universities and perhaps a local Landlords Association. These generally set high standards for properties and provide for landlord training, in exchange for marketing opportunities for the landlord. For more information on this, and a directory of local schemes, see the Accreditation Network UK website www.anuk.org.uk.

However, note that a letting to a student is not treated in law any differently from a letting to anyone else. It will be an AST unless the total annual rent is over £25,000 pa or unless the landlord lives in self contained accommodation in the same building (provided this is not a purpose built block of flats) in which case it will be a common law tenancy. The main differences between common law tenancies and ASTs are that the deposit does not need to be protected in the TDPS, and there is a different notice and a slightly different procedure to be followed if the landlord needs to evict the tenant.

Note that further information about tenancy types and an interactive guide can be found via the Landlord-Law Tenancy Trail.

Particular problems with student lettings in the private sector

There are two main problems with lettings to students which do not generally apply to normal lettings. These are:

  • Dealing with the long vacation, and
  • Possible problems if tenants fail to vacate

Dealing with the long vac

Unlike the rest of us, students get very long holidays! The longest of these is the summer vacation. The academic year will generally start either in September or October and will end in June or July of the following year. This leaves at least two months over the summer. There are a number of ways of dealing with this.

Letting for the year. In many cases the landlord will just let the property for the whole year, and if the students want to rent the property they will just have to pay rent over the summer period, whether or not they are living there. Many students will be happy with this as they will have left home, or be looking to spend at least part of the long vac in the property, perhaps getting a temporary job locally.

Charging a lower rent for the summer period. In many places, perhaps those where there is an abundance of accommodation available for students, landlords will charge a lower rent for the summer period on the basis that the students will not be living there. This often works very well, however sometimes students will abuse this and move in to the property full time during this period.

Letting the property out as a holiday home. Where the College or University is in a holiday area, such as Cornwall, some landlords will let the property out during the vacation, at a much higher rent, as a holiday home. Again this generally works very well. The student has an enviable home during term time, and the landlord is able to offset the low rent charged to the student by charging premium rates to holiday makers over the summer.

If tenants fail to vacate

In the vast majority of cases students sign up for their next years accommodation in March/April time, while the student tenants for the current year are still in occupation. In the vast majority of cases this does not cause a problem as students will be going 'home' for the long vac.

However it is important to remember that under section 5 of the Housing Act 1988, if they stay on after their fixed term has ended, they will have a perfectly valid periodic AST, and the only way the landlord will be able to get them out is by serving a section 21 notice (if they have not done so already, and many landlords do not) and then issuing proceedings for possession. This process will take some three to six months depending whether the section 21 has already been served or not, and how quickly the court deals with the possession claim. If the worst ever does happen, it will be virtually impossible for the landlord to obtain an order for possession and then a bailiffs appointment before the new students came along in October.

If this ever happened it would of course cause major problems, as the incoming students would have no-where to go (all the other student accommodation having long since been taken up) and the landlord would be liable to them for any additional accommodation expenses incurred, before they found somewhere else permanent to live. If the original students were then evicted, the landlord would have lost the chance of getting new students until the next academic year.

It should be emphasised that this very rarely happens. Almost all students leave when they are supposed to. However it is important to be aware that signing a tenant up for a tenancy before the current tenants have actually vacated, is always a bit of a risk.

The Landlord-Law student tenancy agreements

Special tenancy agreements are now available via the Landlord-Law site which attempt to deal with these two problems. Special clauses provide for the tenancy to be treated differently during the summer period – the tenants are charged a lower rent but are not entitled to live in the property. Special clauses also draw the students attention to the fact that it is essential that they either sign up for a further year or vacate on time, and provides for them to be liable to pay compensation to the landlord if they fail to do so.

Versions of the tenancy agreements are available with either or both (or neither) of these special clauses via the Landlord-Law student tenancy download section.

Conclusion

The student letting market is one area of renting which seems to be holding up in the current recession (March 2009) and even increasing. However it is important to realise that there are some potential problems inherent in the way most properties are let to students, even though these problem situations may materialise only rarely.

So far as students are concerned, their rights and obligations will depend on the type of accommodation they hold and whether or not their landlord is the college they are studying with, or a landlord in the private sector.

Accommodation Offices are generally extremely important in the student market, as students are usually safer renting properties recommended by them, as they will normally have had to satisfy stringent standards. They are important for landlords also because they are the best channel to use to make properties available to students.

The increase in accreditation scheme is also important and will serve to improve the standard of accommodation made available to the student market.

Most student lets go smoothly, and the use of a carefully drafted tenancy agreement can ameliorate some of the potential problems which exist for private landlords. It looks as if the student lettings market may be a good area for landlords for some time to come.

If further information is required this can be obtained via the Landlord-Law site , from the excellent book 'Student Housing and the Law' by Martin Davis and Graham Robson, published by Shelter, and from my own book 'Renting; the essential guide to tenants rights' published by Lawpack.

(Note – this article refers to lettings of property in England & Walks UK).

© Tessa Shepperson, March 2008

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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