Investors ‘shun’ York after curb on student houses
A crackdown on ‘studentification’ has brought fears of a two-tier property market and a shortage of homes to let in York. Sharon Dale reports.
CONCERNS over the proliferation of student houses in some parts of York have long echoed round the university city.
Now the council has taken drastic action. An Article 4 direction recently came into force, which means investors will be forced to apply for permission if they want to turn a private dwelling into a rental property for three or more tenants.
Unlike other local authorities that use the planning rule to curb “studentification” of specific areas like Headingley in Leeds and Jesmond in Newcastle, York’s is city-wide.
While the owner-occupiers in Badger Hill, Hull Road and Osbaldwick, who campaigned for the policy, are thrilled, those who fought against it are not happy.
York Residential Landlords Association Chairman Niall McTurk, of Sinclair Properties, says it is already creating a twotier property market.
Those properties that are already HMOs, houses in multiple occupation, are now worth more than identical family homes in the same area that don’t have the relevant permission.
“Homes that would’ve attracted a queue of investors before have started to drop in value,” says Niall.
“I also know an owner who wants to let her home to students while she relocates for work. She was expecting £1,900 a month. As she is unlikely to get permission under Article 4, she is now faced with getting just £795 and is devastated.”
The RLA says landlords are starting to shun York and this will result in a “massive shortage” of both student and private lets at a time when the nation needs more rental property.
It believes the lack of supply will also push rents up and quality down.
“Why would an investor buy here when he or she will then have to wait between three and six months to see if they can get council permission for a shared house? They won’t,” says Niall.
“That is bad news for students but also for young professionals and those on low incomes who want to share a house to keep costs down.
“Some landlords who already have HMOs are pleased because lack of supply will benefit their business but I am looking at the bigger picture. It’s bad for the economy.”
He is angry and frustrated that the council ignored concerns from the RLA, the University of York, National Union of Students and the local Chamber of Commerce, which said the move would “stifle and dramatically reduce” accommodation options for employees of York firms.
However, the City of York Council is unrepentant. The conflicting lifestyles of some young students and their grownup neighbours has always been a problem and this has been compounded by investors buying up family homes. It says the solution is more purpose-built student accommodation.
“York is a small city with a rapidly expanding student population. We need to keep a mix of property and we need to stop areas like Badger Hill being completely taken over by student lets,” says Coun Dave Merrett, a member of the transport, planning and sustainability committee.
“Rather than see the problem of investors buying family homes displaced we decide to adopt the Article 4 across the city.
“We are encouraging the educational institutions to provide more accommodation and we want to institutional investors to build more student accommodation here. We have even identified potential sites for them.”
Down in Oxford, the city council has used a range of strategies to limit the number of students in private rented property to 3,000, including Article 4.
Simon Tyrrell, of Finders Keepers Student Letting in Oxford, says the restriction has created issues.
“Landlords are buying to let to just two people or families because they can’t be bothered to try and get planning permission for a HMO. So we’re seeing a shortage of property for three or more sharers be they students or young professionals.
“Another consequence is that some family houses are blighted. Before Article 4 if you had a house in between two HMOs that was up for sale an investor would’ve snapped it up. Now it is hard to sell. A family doesn’t want to live there and an investor won’t want to try and get the planning consent.”
He doesn’t believe purposebuilt student blocks with bedsits are the solution.
“Students live in halls for a year then move out into the community and share with friends. They don’t want to live in a tiny room with an en-suite for three years. Even the new student accommodation providers admit their biggest challenge is retaining students after their first year.”
He suggests that institutional investors could build large four bedroom flats with two shower rooms for sharers.
“I’m not sure what the answer is, but when Labour encouraged everyone to go university they didn’t think it through. They didn’t think about where all these young people were going to live.”