Student landlords suffer – but demand is surging

‘There is actually a shortage of student rental homes in university towns’

Landlords renting properties to university students have had their income pummelled, but demand is now on the rise ahead of students returning in September.

Revenue from student lets dropped by 30pc last year, according to analysis by Goodlord, a property technology firm. Tenant demand collapsed amid remote learning, deferred entries, and a lack of students from overseas. Students have pumped millions into accommodation they have been unable to use, but landlords have also seen revenues squeezed on properties with no tenants.

Tom Mundy of Goodlord said: “This represents a huge hit to this section of the rental market, and the depressed demand is clearly reflected in the average price of rent for student properties.”

According to Goodlord, the average rent on a student property in 2018 and 2019 was £1,265 a month. But in 2020 this had fallen to £1,012, a drop of 20pc on average across England and Wales.

There are now reports of a shortage of accommodation in some university towns. Mark Hayward of Propertymark, a trade body, said: “We are seeing a surge in take up on rentals now. There is actually a shortage of student rental accommodation in all of the university towns.”

As part of the Government’s roadmap out of lockdown, students on courses that required practical teaching were allowed to return to universities in England earlier this month. All other courses must continue to be taught online.

Mr Mundy said landlords would see a “big boost” in demand in the summer if universities confirmed plans for a more “normal” academic year.

David Peterman, 65, runs a portfolio of 180 student bedrooms, which are already 90pc rented for the next academic year.

“We are ahead of where we were this time last year, partly due to increased demand, but partly due to some effort to market earlier than in previous years," he said.

Separate figures from the charity StepChange showed that 460,000 private renters had fallen behind on payments during the pandemic. This means 150,000 tenants are at risk of eviction when the ban on bailiff evictions is lifted. Last week, Robert Jenrick, the Housing Secretary, extended the ban by a further two months.