Landlords have been warned today that the student rental market is now under threat due to the fact that numbers applying for university have dropped in the past year. In 2012 the number of young people applying to university was only 265,784, which is nearly nine per cent less than the year before. It is believed that many young people are choosing not to go to university since tuition fees have increased to almost nine thousand pounds per year.
The fact that there are less young people applying to university means that there will also be less demand for student housing, so landlords need to keep a keen eye on the news to find out whether the areas they rent out in will soon be affected. Landlord Assist managing director Graham Kinnear has said: “A continuing trend of reduced student numbers is worrying news for student landlords in university towns who, over the years, have been able to anticipate full occupancy levels for the academic year. If university applications continue to drop at the current rate this could ultimately lead to some landlords having empty properties on their hands or having to cope with falling rents in coming years.”
Student landlords are being advised to make sure their landlord insurance policies have rent guarantee insurance built in so that if they find their properties unoccupied they will still be able to pay their mortgages. They are also being advised to maybe start branching out into different forms of letting, especially as young people are now more likely to take on apprenticeships after finishing school in order to gain professional qualifications instead of degrees.
Steven Parry, commercial director at Landlord Assist said: “We feel that the numbers applying to higher education may continue to fall as long as tuition fees are in place and the jobs market remains flat. With the continuing trend for fewer university applications student landlords need to consider their business strategy and perhaps reinvent themselves in the professional letting market or move over to letting houses of multiple occupancy.”