Agents on the impact of the pandemic on the student lettings market
The pandemic has wreaked havoc on the student lettings market, disrupting its usually reliable seasonal peaks and troughs for agents throughout the country.
Demand in the student lettings market reflects the ebb and flow of university semesters but is historically strong, and tends to encourage longer 12-month lets. The pandemic and the subsequent closure of universities disrupted this traditional sequence of events, and continues to cause uncertainty as the new term approaches. “Universities are still being very vague,” says Neil Bharakhda, Regional Manager at Leicester-based property management company, Set To Let. “We get the impression that they’re also sceptical about filling course spaces - potentially they may find not enough students to carry out a course for the entire year.”
Bharakhda says they have been feeling the effects since January. “We traditionally see a noticeable number of international students, many of them Chinese, arriving to do an English course after Christmas and that didn't take place this year. Then, in February, what was happening in China came to light.”
For Prab Singh at Arch Living, an estate agency that primarily caters to student tenants, they also saw a dip in move-ins. “March to the end of April is letting season for students - and we lost that. So now we’ve got many houses sitting empty,” he says.
Despite the lettings market being allowed to reopen on May 13, this hasn’t translated to a surge in student lettings, as these are also dependent on university plans which have not been made clear so far. “Leicester has two big universities,” Bharakhda says. “There's no clarity whether or not they’ll open their doors in October. One university has said they’re considering not opening up in October but students have not had clarity on that.”
It’s not just the students but the agencies who’ve seen little communication. “The way we received information was from the tenants - a lot of information was being shared by the student unions themselves,” says Singh.
Arch Living has seen students inquiring about properties but few signing contracts, as uncertainty remains about the fate of their university courses and the format they’ll take - which may yet affect the traditional long-term tenancies associated with the student market. “I believe that Leicester university has released guidelines saying that they're going to introduce flexi-learning where things will predominantly be online and, if students do need to attend, they can book their accommodation for weeks at a time,” says Singh. “That's had an impact on us because it takes the necessity out of a student needing long term accommodation.”
Bharakhda predicts that tenant demand will grow again in the new year after the first term is over, and there’s more clarity on how the rest of the academic year will play out. “Students are considering staying in their hometown, doing that distance learning and looking to relocate in January or Christmas, after the first term is over.”
A dip in the student presence in a university town or city, however short term, will have more repercussions than accommodation, says Bharakhda. “We take it for granted how much local spending students bring to any town or city. Students are the ones with disposable incomes. Although they’re on a tight budget, they spend money without having to think twice, whether that's on accommodation or food, nightlife, restaurants. They're the ones who really make any city and town thrive.”