London’s foreign and UK student renters return to the market despite Covid fears

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A new wave of overseas and domestic students have ignored COVID fears to look for digs in central London.

Despite concerns that the student market could be heavily impacted this term, estate agent Dexters reports that 1,800 have signed up as potential tenants at its central 12 offices during the last month, with others registering at the company’s network of 70 offices across the capital.

Students make up about 25% of all tenants registering with its city central offices, mainly in Bloombsury and Fitzrovia, South Kensington, Chelsea and Notting Hill.

Marketing director Richard Page says some industry commentators have been anxious about whether the student accommodation market would return due to uncertainties related to Covid such as travel and social distancing, as well as the ongoing lack of clarity around fees for EU students due to the Brexit discussions.

He adds: “Our new Dexters’ London student survey shows that this September the student market has returned in force to the capital’s lettings sector and our findings underline the continuing appeal of London and global confidence in the UK university system and the calibre of courses being offered.”  

In the last academic year, more than 372,000 higher education students were living and studying in London, 107,200 of whom were from overseas.

Dexters says their requirements differ widely; youngsters typically pay £200 to £500 per week for one-or two-bedroom flats in Fitzrovia, while Mayfair attracts super-affluent ‘platinum students’ paying between £1,500 to £3,000 a week for air conditioning, underfloor heating, an on-site gym and CCTV security.

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Government forcing landlords to house non-paying tenants for lengthy periods

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When Robert Jenrick made his shock announcement on the 21st of August of a new 6-month notice period in England (copying ‘socialist’ Wales) he further abrogated the state’s responsibility. How could it be right that private citizens are now made to house non-paying tenants whom they ordinarily would have been able to evict after ‘only’ losing about 7 months’ rent?

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BREAKING: Compulsory licensing of Airbnb moves a step closer to reality in Scotland

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Compulsory regulation of Airbnb short-lets in Scotland is now only 18 months away after the country’s government launched its final consultation on proposals for the controversial housing sector.

This will then lead to legislation that it expects to go live by April 2021.

The plans, assuming they are voted through the Scottish parliament, will be the first of their kind in the UK and will put pressure on England, Wales and Northern Ireland to follow suit.

The new powers will cover all short-lets, which will be counted as accommodation made available for use for letting for a cumulative period of 28 days or more during any rolling 365 day period, and not used as a ‘main residence’.

Consultations

Following an initial consultation last year, proposals were published in January that would see councils empowered to regulated short-lets more easily, should they decide it is in the interests of their local community.

Scotland is now consulting on the final version of these proposals, which will enable councils to licence short-lets as well as introducing control areas where planning permission will be required to change whole properties into Airbnb rentals to manage short-lets densities.

Also, the Scottish government intends to ensure Airbnb hosts and landlords pay tax on their earnings in a way that makes an ‘appropriate contribution to local communities’.

“I believe our proposals for a licensing scheme and short-term let control areas set out in this paper are evidence-based and right for Scottish circumstances,” says housing minister Kevin Stewart (pictured, above)

“Short-term lets have become the subject of much controversy in some parts of Scotland and evoke strong opinions.”

Read more about Airbnb.

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Lincoln Licensed Deathtraps

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This story concerns two slum-like death trap HMOs which had both been granted recent HMO Licences by Lincoln City Council and condemned as unsafe for habitation by an independent expert.

One such HMO Licence was granted as recently as January 2020 and even after inspection by one of Lincoln City Council’s supposedly expert Housing Officers

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LATEST: Food and retail shops ask Ministers for more help to pay their landlords PLUS a delay to rates re-start

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Retail and catering bosses have called on the Government to give them more breathing space, warning that when landlords take back the keys, thousands of sites and jobs will be lost.

Retailers have told the Treasury that reinstating business rates in full next April will make 800 stores non-viable overnight, at a cost of 10,000 jobs; it follows a report last week that 125,000 retail jobs have been lost this year. 

Meanwhile, UKHospitality has written to Chancellor Rishi Sunak and the Secretary of State for Housing, Communities and Local Government Robert Jenrick warning that a “bloodbath” of hospitality business failures will follow the end of the moratorium on lease forfeiture and debt enforcement if action isn’t taken.

The letter says: “Many landlords have already made it clear, in writing, that they will use the end of the moratorium to issue winding-up petitions to large high street chains and individual businesses.” 

The Government’s emergency measures to protect tenants such as preventing landlords from serving statutory demands or winding up petitions are due to expire on 30th September.

UKHospitality believes if tenant protections were extended until next spring, firms that suffered a lack of revenue in lockdown could enjoy Christmas trading, making them more able to repay debt.

The trade body predicts that by the time the moratorium is lifted on 1st October, the sector’s unsettled rent bill will amount to more than £1bn.

Law firm Baker McKenzie explains that receipt of the September quarter’s rent is a potential danger zone for landlords.

It adds: “There is a risk that accepting rent for the September quarter after 30th September but before dealing with any outstanding breach of covenant (such as the failure to pay rent during lockdown) will waive the landlord’s right to forfeit the lease for such breach.”

Read more about quarter rents.

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‘Get on with it and deliver Section 21 ban’ council urges government

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Hackney Council has renewed calls for a permanent end to Section 21 evictions, arguing that extending the ban to cover Christmas doesn’t deliver the ‘long-term security tenants desperately need’.

The London borough says that while it welcomes the extension of support so landlords can’t evict tenants until March 2021 – apart from in extreme cases – renters deserve more than a series of temporary fixes for what was a permanent problem long before the pandemic hit.

Throughout the crisis Hackney Council has been urging the Government to provide a long-term plan to support private renters and earlier this month wrote to Housing, Communities and Local government minister Robert Jenrick asking for the current ban to be extended until its promise to end unfair Section 21 evictions is delivered.

Although the Government had originally committed to ban ‘no fault’ evictions in April 2019, it is yet to implement the changes.

Mayor Philip Glanville (pictured, above) says a full ban is a ready-made measure that finally gives renters the protection they need.

“The coronavirus crisis has shone a light on the complete absence of security and stability that thousands of private renters in Hackney and millions across England face,” he says.

“After more than 18 months of delay, it’s time that ministers got on and delivered it.”

Hackney Council believes that with more than 30,000 households in the borough now renting privately, nearly one in three residents are vulnerable to eviction.

In June it wrote to all its 2,500 registered landlords asking them to offer time and flexibility where tenants were struggling financially, and to consider rent reductions where a tenant really couldn’t pay.

The government announced it intention to ban Section 21 ‘no fault’ evictions last year but, after a significant consultation process, has yet to reveal its intentions.

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Guidance for lenders to support borrowers post mortgage holiday period

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The FCA has published additional guidance for firms, to ensure that consumers who have benefited from payment deferrals under the current guidance who still face financial difficulties, as well as those whose financial situation may be newly affected by coronavirus after the current guidance ends

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LATEST: Renters join the urban exodus to seek spaced-out suburbia

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Renters have joined home buyers in the ‘space race’ by rushing to the suburbs where the number looking to rent is up on last year. 

As tenants’ priorities change, Hamptons International reports that up-sizers have swapped smaller city centre flats for three-bed semis on the fringes of town.

According to its monthly lettings index for August, 34% of tenants moving home post-lockdown added at least one extra bedroom to their new property, up from 25% during the first three months of the year.

It also found that 25% of moves post-lockdown were from a flat to a house, up on 16% pre-lockdown. 

Tenants living in the South East were most likely to trade up, with 47% of those moving adding at least one bedroom and spending an additional £266 pcm, followed by the North West (37% adding at least one bedroom) and then London, where 33% added at least one bedroom. 

All this upsizing means that these renters paid an average of 23% or £149 a month more in rent.

Lower rents overall

But rents country-wide fell for the fourth month in the last five. Average rents on newly let properties were 0.5% lower than the same period last year, driven by falls in London and the South.

Fewer homes

Across the country, there were 11% fewer homes available to rent than in August 2019, says Hamptons, with northern regions recording some of the largest falls. 

The North East saw the largest decline, with 45% fewer homes to rent than at the same time last year.

Hamptons’ head of research Aneisha Beveridge (right) says: “The number of homes coming up for rent is down on last year, partly due to landlord purchases being much slower to bounce back in comparison to the number of homes bought by first-time buyers and owner-occupiers.”

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Law Society comment on government protection of tenants

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The Ministry of Housing, Communities and Local Government has announced further measures to protect renters.

Law Society of England and Wales president Simon Davis said: “Possession hearings restart on 21 September, meaning that landlords are able to commence hearings to evict tenants.

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New short-lets platform targets apartment block landlords with Airbnb-style service

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An new British online platform that’s hoping to take on Airbnb and make hay from the US firm’s difficulties over here has secured the backing of a major property industry figure.

Robin Paterson, who was instrumental in building many of the UK’s estate agency brands during the 1990s including Hamptons, Cluttons and Barnard Marcus, has come onboard at Stayo.co as its non-exec chairman.

As many landlords will be aware, Airbnb has endured a torrid six months as the Covid restrictions, worries over party houses and both local authority and freeholder backlashes over problems caused by the rapid growth of the short-lets platform have battered its reputation.

Stayo hopes to benefit from this by directly sub-letting blocks of apartments from freeholders, initially specialising in mid- to up-market London neighbourhoods.

Dedicated team

It claims to be different from other platforms because it offers a comprehensive end to end management service, whereby its dedicated team is responsible for all aspects of the accommodation as well as the ‘guest experience’.

“The Corona pandemic has offered an opportunity for those companies brave enough, to completely re-evaluate how they do things and dramatically change for the better,” says Paterson (right).

“It is a pleasure to work with the Stayo team who have this courage and conviction in repositioning their business due to the cataclysmic consequences of Covid-19”.

Stay currently has 43 units within 10 buildings across central London, although its target is to grow the portfolio to 300 units over the next three years, before expanding into other UK and European cities.

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