Renters Rights Act - student shared houses

[EffectivelyDaydreaming]

My DD is in first year and looking for houses with a group of friends but there seem to be a lot of issues around the Renters Rights Act coming in this May. One place refused them a joint tenancy because one student is from overseas and guarantor issues (may not be connected to RRA). Another they have looked at wants to issue a licence to each student rather than a tenancy, which from brief googling means their rights are weaker, but there seems to be widespread confusion. Is there anyone that has a more in depth knowledge of what all this means for student houses, pros and cons of various options etc? Useful sources of info? Or anyone else's DC having problems too.

DC graduated 2 years ago and his flatmate whose parents lived overseas had to pay her annual rent up front as her parents couldn’t be guarantors. What I didn’t realise is that the other three guarantors then effectively became her guarantor for any damage. I wasn’t happy about the risk, as DC didn’t really know her but it ended up ok. All the flatmates had separate agreements via the agency.
As usual, although they were paying way over market rent for the property, compared to non-student lettings, neither the agent nor landlord gave a sh*t about any repairs or maintenance. I had to get involved at one stage to get their boiler repaired as agent/landlord were quite happy to leave them without hearing/hot water for a fortnight.

The RRA doesn’t affect students rentals as much as private rentals. There is an exception which allows the landlord to get the current tenants out for the next lot of students. It is the case that if one student in a joint tenancy gives notice than that ends the tenancy for all. I don’t know about licenses - my DD is looking for a house now and it’s either leased room by room or whole property as before.
The guarantor thing is unlikely to have anything to do with it. When I let to foreign students and they paid upfront.

I think you won’t be allowed to pay upfront for 12 months anymore. I think it’s max 2 mths. So people won’t be able to get around the guarantor requirement that way.

There are companies that can be the guarantor instead.

But we’ve had problems with other students not being able to get a suitable guarantor 2 years running. Retired parents with assets but low ish income can’t be guarantors for “affordability” reasons ……

I've read that you can pay a year upfront if you suggest it rather than the landlord asking for it but still doesn't get round the damages thing. I think that is possibly a separate issue to the RRA. I have also read that more LLs are going for separate tenancies instead of joint because of the whole thing ending if one moves out. But I hadn't come across the using a licensing rather than tenancy agreement till today but I can see it might be attractive to LLs but what are the implications for students.

I don’t think the license would be valid as the whole idea even now is that sham agreements cannot prevent proper tenancies being created. Individual agreements for each student are much better as no one becomes liable for other people. It’s very common now for professional house shares to have an all in rent including utilities broadband tv licence and cleaning of the common parts as well as council tax. Much more straightforward for everyone.

Fortunately I think all except the overseas student have suitable guarantors.

Ah so even if it's written as licensing it could actually be a tenancy if it doesn't meet certain criteria.

I think it will push rents up for students even further as landlords will price in the risk of one serving notice or early terminations - so for example now students contracts run July to July - but these won’t be allowed any more and students could give notice at any time. So a landlord will price on the basis of getting x months rent rather than 12.

RRA will affect students and landlords who accommodate them. Students who dont have a UK based guarantor usually pay the rent upfront for the term of the tenancy, but under RRA, a maximum of one months rent in advance is all that is allowed. The tenant can opt to pay the rent in advance, but the landlord cannot ask for it and it can only be paid in advance after the let commences - so the landlord would have to rely upon trusting the tenant to pay after they have already moved in. Likewise the tenant would have to trust the landlord to refund, should circumstances arise when the tenancy terminates early. There are two good companies who act as professional guarantors and for a fee will guarantee the rent (but not the deposit) - RentGuarantor and Housing Hand - both long standing and trustworthy. A licence can only be issued if the landlord lives in the property with the 'tenant' (who becomes a licensee rather than a tenant). If they dont then a tenancy agreement is required. Some landlords are issuing individual agreements for each tenant, so that if one gives notice, the others are not affected, but this means it is at the landlords discretion who then moves in to the vacated room, which the remaining tenants may find unacceptable. Its unlikely that if all are on one agreement and one gives notice the landlord would want the remainers to leave, as this would remove him from the student lets cycle. If he were to re-let he would be unlikely to get students and taking professional sharers or a family would mean a lower rent and he cant guarantee they would leave in time for the next round of student lets. This means the remainers would have to cover the rent due from the vacated tenant, or the landlord would have to waive it - or they could meet half way!! RRA has changed the threashold for rent arrears to 3 months (13 weeks for weekly rents), so if there are 5 sharers, one leaves and the others decline to pay the difference, the landlord cannot take action for arrears until the total sum outstanding is 3 months rent - which could be 7 or 8 months and then must serve a Section 8 notice which is a further month. I hope this is helpful!

Thank you that is helpful. I have done a bit more reading myself and found that a licence can also be created if the landlord or their representative retains the right to enter at any time and does so, and the most common way of doing this is providing cleaning.

I would double check your source for that - the landlord has to be resident for that type of access. If not, the tenant can decline to allow access. Including cleaning doesn't give the LL right of access, even if included in the rent. Only in the event of an emergency, which threatens the fabric of the building can the landlord go in without the consent of the tenant. I have worked in res lettings for 40+ years - there is a lot of fake 'advice' on the internet, so I would always advise taking actual paid advice from legal counsel or consulting Citizens Advice.

Thanks. This was on a webinar for landlords but on my other laptop so not sure which. Anyway they are still house-hunting so we'll see. I'm going to speak to a friend who is a longterm student landlord too and DD is talking to her student union advisors. Proper advice is a good idea.

@EffectivelyDaydreaming uni housing services are providing info to students on their rights, which will answer your questions and is probably more accurate than mumsnet. E.g. here is UoL Housing's info: https://housing.london.ac.uk/get-advice/renters-rights-bill-faq

Thank you, I did look on DD's uni website a few weeks ago and didn't find anything, I will look again, that link is helpful. Actually thinking about it hers is one of the UoL unis so the link is directly applicable I will forward it to DD. I am pretty sure the one that they looked at last week would have been a sham licence situation.

I would expect the university should have an accommodation officer who can review the contract offered and provide legal advice and help the students to make an informed decision

Yes, they have and they are definitely planning to use that checking service. They didn't get that far last week, there was some preliminary info from the landlord that raised alarm bells about licensing.

Your DC is lucky they have you thinking about this. There are many landlords who exploit the naivety of students, especially in London. UoL Housing's contract checking service is very good ... I encouraged my son and friends to use it, and joined the call myself to listen in as a guarantor. The advisor stepped through the very long contract line by line and explained where they would need to be cautious. They also gave good advice like making sure all comms with the landlord were in writing, ideally by email, not Whatsapp (which can be deleted).

My son's group later had an issue over utility payments and a UoL advisor helped them write a letter to the landlord to negotiate a fair outcome.

Daughters rent has gone up £50 a month 2 bed flat, landlords are getting nervous as it’s much easier for renters to leave so they could have months without rent. It’s now harder as with international students could pay the 12 months up front and now they can’t.

They can, but they can't be required to.

How does this work in practice? They can’t be ‘required’ to pay in advance but they can still offer. However, if they don’t ‘offer’ then surely the landlord can simply refuse to agree to the letting? DS was told that he either had to have a guarantor or had to ‘offer’ to pay full rent in advance.

I have seen many suggesting that RRA doesn’t apply to student lets. That is only the case if the accommodation is a licensed PBSA - so either private or uni Halls or similar.

DS is moving into a studio in a small PBSA managed through a private lettings agent. The agent says they are still waiting for final guidance from the government (typical) on how the new law will affect them.

That's a good idea re joining the checking call. TBH I hadn't given the RRA any thought till about 10 days ago when DD told me about it although when she said they thought they had found a house a couple of weeks earlier I did get straight onto the uni website to see what advice they had for students generally re private housing and found out about the checking service. I have learned a lot in the last week but also been lucky that one of the other parents flagged the licensing issue as I am up to my eyes in elderly parent care ATM.

I think its too early to know how it will play out. Someone on another thread said landlords who are worried about being accused of 'requiring' an upfront payment may refuse to accept one even if offered.

My younger son's rental contract for year 2 is taking a very long time to get signed, and I'm certainly worried about that. I only have second hand info from my son, but I think one of the prospective tenants is an international student. The agreement requires a guarantor with uk assets, so they may need to get a third party guarantor instead. All I can do is cross my fingers that they will get it sorted before the landlord gets fed up of waiting and pulls out (especially as they have already signed up for a joint utilities arrangement 🫣).