In early February, the government released details of its Housing White Paper that it hopes will correct many of the problems in the current housing market. Called Fixing Our Broken Housing Market, it examined a number of issues, particularly surrounding Buy To Let of which the student accommodation market is a major part.
The State of the Student Market
Most of the paper focused on developing more land for housing – something largely underfunded and ignored in the last 20 years. It is the reason there is even a White Paper in the first place. The document made several suggestions for speeding up application processes for residential zoning. This is designed to serve the dual purpose of allowing people to buy their own homes but also make renting more affordable for everyone and a viable option in general.
One group who has no choice but to rent is the UK’s student body. There has been concern about the lack of provision for students. Some landlord representative organisations feel that this important part of the sector is being ignored in favour of investors buying property to house families or for letting to young professional couples.
Is There a Student Accommodation Shortage?
According to several influential sources, and due to increased student population, mot university cities now have a distinct shortage of student accommodation. Demand vastly outstrips supply and the situation is even more critical than the regular BTL market. While there is a clear shortage of general BTL accommodation, few realise how critical the situation is for students.
In a recent poll, it seems that Exeter has the highest shortage levels closely followed by Bath Spa and University of Bath. Most of the owners in these areas, and indeed the student market in general, is made up of landlords who own just one or two properties – and it is this concern of a continued shortage of student letting property that could create more problems if the student market situation is not addressed.
What are the White Paper’s Provisions for the Student Market?
Most of the paper focuses on redeveloping brown belt land or green belts in suburbs for family lettings. The problem is that the majority of university campuses exist in the centre of towns and cities. The student accommodation market that has grown up in urban areas, often in older buildings once reserved for families, is locked to these areas for convenience. Green spaces cannot be built on, and the government has an international mandate to protect the environment. This includes urban green spaces.
There is just one mention of student accommodation in the white paper and that is pointing to the growth of the sector in recent years. Clearly, this is not enough. There is a long way to go for this White Paper to become reality. Student landlords should watch developments carefully.