The forthcoming legislation to eliminate fixed-term leases in England has sparked serious concern among property owners, who fear it may wreak havoc on the student housing sector. This change, proposed in the Renters (Reform) Bill, will replace fixed-term leases with rolling leases, which do not have a set end date. Such leases are usually set up with weekly or monthly rent payments.
Presently, property owners renting to students generally provide a 12-month lease to align with the school year, ensuring their properties aren't vacant outside term periods. With the new law, tenants will only need to give two months' notice to vacate a property. Evictions, too, will be subject to stricter rules, with landlords only able to evict tenants under specific conditions.
The National Residential Landlords Association (NRLA) has voiced concern that the lack of guarantee that properties will be ready for new students at the start of the academic year might result in confusion. The NRLA suggests adding a provision that would allow student landlords to terminate a lease in accordance with the school year. They worry that under the current proposals, landlords will have to depend on current tenants to leave the property in a timely manner for new students to move in.
Sarah Black, a landlord renting four properties to students in Bath, expressed serious concern about the proposed changes. She believes that the new law could cause disarray since landlords won't be able to promise that their properties will be available the next academic year. She normally rents to a group of friends for a 12-month period. If one tenant decides to stay on, it could prevent another group from moving in. Moreover, if a tenant decides to leave early, a room could stay vacant for several months until the start of the next academic year, causing a financial loss.
Meanwhile, the National Union of Students and Universities UK have expressed their views. The student union stated that if students were exempt from these reforms, they would become a disadvantaged group. They emphasized that the current system of fixed-term tenancies often forced students to pay for rooms they weren't using during the summer or if they dropped out early. On the other hand, Universities UK warned that eliminating fixed-term leases for student housing could destabilize the sector and lessen the available accommodations.
Labour MP Clive Betts, chair of the Commons Housing Committee, argued that all student housing should be exempt from these changes. He suggested that if more landlords were to exit the student rental sector, it would exacerbate the existing student housing shortage.
The Department for Levelling Up, Housing and Communities commented that most students would not be affected by these reforms as they usually move out at the end of the academic year. They also assured that they are in active dialogue with students and landlords to ensure these measures work for both parties