The ultimate landlord guide to student properties - Total Landlord Insurance

May 30, 2022
The ultimate landlord guide to student properties - Total Landlord Insurance

The UK is a world leader in higher education and is the second most popular choice for international students. According to Savills, around 60 per cent of investment into single purpose built student accommodation assets came from overseas investors in 2020.

And total university applications for the 2022/23 academic year are up seven per cent on pre-pandemic levels, meaning demand for all types of student accommodation is set to remain strong.

As standards have risen all across the rental sector – and particularly because of the surge in institutional investment in modern, purpose-built rental accommodation for students – private landlords have had to raise their game. The days of shabby student ‘digs’, sparsely kitted out with mismatched, second-hand furniture are long gone!

Today, as a landlord of a student property, you not only have to provide high-quality accommodation and amenities, you also have to understand and meet your legal obligations and use best practice in looking after your student tenants. If you can get all that right, then this market continues to represent a major investment opportunity. But what exactly do today’s students want from their landlords and accommodation, and how can landlords best meet those expectations?

This guide tells you what you need to know about letting to students in 2022 and beyond – and here’s a handy summary of the contents so you can skip ahead to anything that’s of particular interest:

  • Are student properties a good investment?
  • What kind of accommodation are students looking for?
  • How to become a student HMO landlord
  • How to attract student tenants
  • What legal requirements do student landlords need to comply with?
  • What are the specific rules for HMOs?
  • Managing the student landlord relationship
  • How to reduce damage to student properties
  • Maximising your profits from a student home
  • How to ensure you have the right student landlord insurance

Are student properties a good investment?

If you’re in two minds about providing homes for students, here are several reasons why you might want to give it some serious consideration:

Demand is consistently strong in the right locations

The student rental market isn’t subject to the same degree of fluctuation as the general housing market. With a relatively stable number of students enrolling in universities and colleges each year, demand for student lets tends to stay at a constant high. The caveat is that students do tend to prefer certain areas and even specific roads, so make sure you find out what those locations are.

Rental cycles are predictable

Another big positive is the predictable rental cycle. Even though the academic year only runs from September to June/July, many students are keen to stay on through the summer, either to continue with part-time jobs, stay with their friends or even carry on using study facilities. So it’s common for landlords to ask students to sign a 12-month agreement without a break clause.

If they’re graduating and leaving the area or they’ve decided to move somewhere else for the next academic year, they tend to give plenty of notice, so as a landlord you can be confident of an ongoing 12-month cycle of tenancies.

It’s financially reliable

One of the biggest misconceptions around student lettings is that you risk not getting regular rental payments and will have to keep chasing up your tenants. In reality, as long as you set up the tenancy in the right way, student lets can be very financially reliable.

Firstly, you can make sure all the tenants sign one tenancy agreement, agreeing to be jointly and severally liable for the rent. That means, as a group, they’re obliged to pay you the total rent for the property every month, even if someone can’t pay their fair share or if one of the tenants has left.  

And, secondly, it’s common for landlords to insist on students having a guarantor – usually a parent or guardian – who agrees to pay if the student defaults. Not only does that give you a financial back-up, but if students know their parents could have to pick up the bill for any damage, they tend to take care of the property!  

Rental yields tend to be higher

Student properties are often HMOs and you can earn more rental income by charging rent on a per-room basis. While the best HMO rents come from letting each room on a separate tenancy agreement with all bills included (a ‘standard’ HMO let), landlords tend to work out student house rents in a similar way, regardless of whether all the tenants are signing one AST.

Even though your maintenance and running costs tend to be higher for HMOs, you’ll generally benefit from higher rental yields and monthly profits than landlords of single-let properties.

What kind of accommodation are students looking for?

There are two main types of property students tend to look for:

Shared houses

This is a hugely popular option among young undergraduates, who generally like to live with their friend group in a relaxed and sociable ‘family’-style situation. Each student has their own bedroom – ideally a decent-sized double room – and then they share kitchen, living room and bathroom facilities.

This type of rental will almost certainly be classed as a House in Multiple Occupation (HMO), meaning you’ll have to comply with more legislation than you would for a single let – mainly around fire safety and minimum room sizes. It’s also increasingly likely that you’ll have to obtain a licence for the property.

HMOs are usually older properties – Victorian, Edwardian and 1930s – as they generally have larger rooms and offer the potential for more flexible layouts. So, if you’re planning to invest in this kind of student let, understand that you might have to invest some additional time and money in getting the property ready to rent.

Purpose-built flats or bedsits

Students in their final year, postgraduates and international students often prefer to have more private accommodation. And even many younger undergraduates are also attracted to the high standard of living offered by some of the newer, purpose-built blocks. These rental units tend to be en-suite rooms or bedsits in luxury city centre buildings, many of which come with on-site amenities, such as a coffee shop, gym and laundry facilities.

This is a great option if you want to be a hands-off landlord, as there is often a bespoke lettings and management company attached to the building that can handle everything for you – from furnishing and maintaining the property to a specific standard, to managing your student tenants.

How to find out what students want from their rental property

There are three main sources of information about what students are looking for and what makes a property most attractive to them:

1. Specialist student/HMO letting agents

They will be able to tell you which type of properties let most quickly for the best rents and the top ‘wants’ tenants come to them with.

2. University accommodation offices

Ask if they can show you their own accommodation units, so you can see for yourself the minimum standard students will expect and find out what accommodation they are short of for which type of tenants.

3. Current online adverts for room and houseshares

Look on portals like Rightmove and Spareroom to see what standard of accommodation other landlords are providing and also check out the ‘wanted’ adverts placed by students to find out what they need and want.


When you’re specifically targeting a student population, you’ve got to be much more precise about where your property is located than if you were advertising to the general rental market. Students want to be relatively close to their campus and have basic amenities nearby. And there will always be certain roads that are top of their wish lists, so find out what they are and consider buying in those locations.

Although students used to want to live within easy striking distance of pubs and nightclubs, their priorities have changed over the years. Today’s more health-conscious students are likely to value being close to gyms, leisure centres and parks – but they also like to be on a regular bus route into the town or city centre.

So it’s vital you invest the time into properly researching the most desirable locations for students. If you get this wrong – even if you’re just a few streets out – you could end up with very few applicants and an investment that simply doesn’t work out.

Fittings and furnishings

Whatever type of property they choose to rent, students will expect good quality fittings and furnishings. Many will have spent their first year in modern accommodation provided by the university, and they’ll expect something just as good – if not better – when they move into their own place.

Choose hard-wearing, modern, sleek kitchen units and bathroom suites, with tiled floors (and walls in the case of the bathroom), that will be easy for the students to keep clean and looking good.

Appliance-wise, you should provide a dishwasher, a large fridge/freezer, microwave, washing machine and tumble-dryer, and the kitchen should be well-stocked with crockery, pots & pans, glassware, etc.

In their bedrooms, they’ll expect a double bed with a decent mattress, a wardrobe, drawers, bedside table and a desk and chair so they can study in peace. If you’re able to provide en-suites, you should be able to charge a higher rent for those rooms.

One thing to be particularly aware of is the minimum rooms sizes that were imposed in October 2018:

  • Single-occupancy rooms must have a minimum floor area of 6.51 square metres
  • Double rooms must have a minimum floor area of 10.22 square metres
  • If any part of the room has a ceiling height of less than 1.5m, it should not be included in the measurement.

There should be space for a dining table and chairs in either the kitchen or living room, and make sure there are enough comfortable sofas and chairs to seat all the tenants at once, in case they want to watch the smart TV (that you’ve also provided) together.

Other features

Probably the most important amenity for students is high-speed WiFi – particularly now that remote learning and Zoom video calls have skyrocketed in popularity through the pandemic.

Speak to your broadband supplier about how many people will be living in the property and make sure they’re able to provide a reliable service that allows all those individuals to be uploading, downloading or streaming at the same time.

Gardens are always a great selling point for any type of let and the ongoing threat of COVID-19 has highlighted the importance of having outdoor space. Get some sturdy garden furniture and make sure there’s a shed, garage or outbuilding where the tenants can securely store bikes and other leisure equipment.

The ‘Generation Z’ students are also very engaged with climate change issues and having an eco friendly, energy efficient property is increasingly important to them. Take a look at our Ultimate guide to having an eco friendly property for information and advice on how to make your property as green as possible.

Top tip: When you’re deciding on what property to buy and thinking about how to fit it out, a good question to ask yourself is: “Would I be happy for a child of mine to live here?”

How to become a student HMO landlord

Letting to students differs from letting to ‘ordinary’ tenants in a number of ways. In order to be successful, landlords interested in student lets must:

  • Invest in the right type of property in the right location and make sure it appeals to students
  • Know and understand the specific rules that apply to HMOs
  • Properly manage their relationship with student tenants
  • Learn how to maximise their profits from student lets

Of course, the success of your student let investment also relies on you having a property full of student tenants! So let’s take a look at how to make sure they know about your property and what you can do to make them want to move in.

Where to advertise

Most towns and cities will have agents that specialise in student lets. If they have a full management service and you don’t want to be too hands-on, this could be an ideal option.  

Another resource that many self-managing landlords use is the accommodation office at the university or college. Most will provide guidelines or codes of practice that landlords need to adhere to in order to be recommended to students and it’s well worth making sure you meet these requirements. The university should then be able to help you market your property to students – particularly those moving out of halls of residence – and they may have other useful advice and resources. Working with universities in this way and getting a reputation for being an excellent landlord should make it easier to re-let your property and may be less costly than finding tenants through letting agents.

In terms of online marketing, both agents and private university halls companies can advertise on major sites such as Rightmove, and then there are portals like, where you can upload your own advert, stating that you have multiple rooms available for students.

The advert

There are a lot of student properties out there and competition for the best tenants can be fierce, so your advert really needs to stand out.

First of all, remember that students are looking for quality, modern accommodation, so have professional photographs taken to show off all the rooms at their best. And make the property look inviting by ‘dressing’ the rooms – put bedding on the beds, switch on some lamps, pop a bowl of fruit on the table and have a few plants around the place.

It’s important to know that if the property is being advertised as furnished, any furniture in the pictures should be the same or of a similar standard to the furniture you’ll be providing to the tenants.  If tenants are induced to rent a property by attractive furniture, but then find it’s not the same quality when they move in, this can be grounds for them to ‘unwind’ their tenancy under consumer legislation and reclaim any payments made.

Your advert should include at least six bullet points that really sell the property, so make sure you highlight the things that students are particularly looking for, such as:

  • WiFi – perhaps include the speed or if it’s fibre, etc.
  • Number of en-suites
  • Secure bike storage
  • Distance from campus, gym and any other key amenities
  • If it’s on a frequent public transport route
  • Size of living room or kitchen/diner, if it’s particularly large
  • Private garden


If you’re using a specialist agent, they will be able to advise you on what level of rent they think will attract the best tenants as quickly as possible, while still giving you a competitive return. Although it might be tempting to go for the highest possible price – particularly if you’ve just renovated a new investment – remember that you only have a certain window of time for attracting student tenants.

Many students like to get their next year’s accommodation tied up before the summer and you don’t want to find your property still sitting on the market by the time August comes around, so be fair and realistic.

Recommendations – word of mouth

Once you’ve had your first year of students, assuming they’re happy, they may want to stay on for another year. However, if they’re planning to move out, you could ask them to recommend the property to other students they know.

You could even offer them a financial incentive, which may be cheaper and quicker than advertising yourself or paying an agent to find new tenants.

What legal requirements do student landlords need to comply with?

In terms of your legal rights and responsibilities, letting to students is no different to letting the same property to other types of tenants – there are no additional ‘student-specific’ regulations. See our comprehensive guide: Legislation for landlords: Everything you need to know.

However, there are areas of the law that might be new to you if you haven’t let an HMO before.

What are the specific rules for HMOs?

The majority of student accommodation consists of HMOs. The Government defines a property as an HMO if there are three or more tenants, who form more than one household (i.e. they’re not related) and they share toilet, bathroom or kitchen facilities.

Licensing and planning

In England and Wales, if there are five or more tenants, the property is classed as a ‘large HMO’ and will need to be licensed. In Scotland and Northern Ireland, every HMO requires a licence.

Additionally, councils in England have the power to impose their own licensing requirements, so even a smaller HMO – or any rented property within the local authority area – may have to be licensed. It’s vital you find out what the local policy is, because if you’re found to be breaching the licensing rules or conditions, the penalties can be heavy – for instance, the council could fine you up to £30,000 without having to take you to court. Read more about licensing in our article, What is licensing – and do I need a landlord licence to let my property?

HMOs also fall into a different ‘use class’ from single household homes, and some local authorities will require you to make a planning application for change of use. With planning, it’s even more important that you find out the regulations before you invest, otherwise you could end up buying a property that you can’t let in the way you’d hoped.

Fire safety regulations

Because of the number of unrelated tenants in the property, the health and safety risks are considered greater, so the rules are tighter. These are based on the rules in England, so do check out specific requirements in N.Ireland, Scotland and Wales and refer to our legislation guide.  

In every rented property:

  • You or your agent must carry out a risk assessment
  • If you’ve supplied furniture and furnishings, they must must comply with the furnishing regulations and have ‘fire safe’ labels  
  • Tenants must have clear access to escape routes
  • There must be a smoke alarm on each floor, tested at the start of each tenancy*

*Note: The Smoke and Carbon Monoxide Alarm Regulations in England are expected to be updated in the autumn/winter of 2022. This guide will be revised with the changes as they come into force.

Additional fire safety regulations for HMOs:

  • Licensed HMOs must have a written risk assessment
  • Each individual unit – e.g. bedroom or bedsit – must have a smoke alarm
  • There must be a mains-powered, interconnected fire alarm system
  • All escape routes from the property must be protected by fitting fire doors with automatic closers – for most HMOs this includes all bedrooms, the kitchen and communal living rooms
  • There must be a fire extinguisher on each floor and ideally a fire blanket in the kitchen

As with any rented property, you need to be able to show you’ve taken every reasonable step to ensure the safety of your tenants. The best way to do that is to ask a local fire safety officer to visit the property and confirm what legal requirements apply. They can also recommend any further ‘best practice’ steps you should take.

Read more about multi-occupancy lets in our complete guide to letting an HMO property.

Do I need to pay council tax for students?

The good news is that tenants in full-time education (and their landlords) are exempt from paying council tax on rental properties. However, it is your responsibility to prove that all of your tenants are in full-time higher education. If you can’t prove that your tenants are exempt, you may be left responsible for paying the bill.

For example, if one of the tenants leaves full-time education and gets a job but carries on living at the property, this will make the property subject to council tax – even if the other occupiers are still students. If the property is empty for any period of time, any council tax charge is at the discretion of your local authority.

Managing the student/landlord relationship

The relationship between you and your student tenants is a fundamental part of being a good landlord and running a successful lettings business. And when you’re dealing with HMOs, this relationship becomes even more crucial – and it begins before your tenants move in.

Reference and right to rent checks

It’s crucial that reference and right to rent checks are made on every tenant. They reassure you that the person you’re letting to is who they say they are and help mitigate against issues like anti-social behaviour and non-payment of rent.

On top of that, most buy to let and HMO specialist mortgage lenders make it a condition of the mortgage that tenants are referenced and credit checked, and landlords in England are legally required to carry out right to rent checks to make sure that tenants have the legal right to be in the UK. It may also be a condition of your insurance policy. Find out more in our ultimate guide to right to rent checks.

When it comes to students, if you ask them to provide a guarantor (which is advisable, to protect you against rent arrears), you must reference check the guarantor in the same way as the tenant. If you use an agent to find your student tenants, they should carry out these checks on your behalf. If you are handling the let yourself, there are plenty of private companies that offer professional referencing services, or you can carry out the checks yourself.

Tenancy agreements for student properties

Like reference checks, tenancy agreements are fundamental to the rental process and key to a successful let.

A tenancy agreement – usually an assured shorthold tenancy (AST) – sets out the terms of the tenancy:

  • Your rights and responsibilities as a landlord
  • Their rights and responsibilities as a tenant
  • The period of tenancy
  • How much rent is payable and when
  • How the agreement can be terminated by each party

When you have multiple tenants, you have two choices:

  1. You can sign a separate agreement (AST) with each tenant, meaning they are only responsible for their own rent, bills and damage. This is usually the case with HMOs where the house sharers don’t know each other and/or may move in and out at different times.
  2. You can have all the tenants sign a joint tenancy agreement, meaning each of them is jointly and severally liable for the rent, bills and damage – i.e. if one of them leaves or fails to pay their share of the rent, the rest have to cover it. A joint tenancy is most common for student house shares.

Importantly, when it’s an HMO, there are three key clauses you should include:

  1. Which bills the tenants are responsible for paying and which you will handle. For example, you might agree to cover the cost of the WiFi and television subscription services, with the tenants being responsible for utility bills.
  2. Clear guidelines around maintenance and minimising the risk of damage. For instance, clarify whether the tenants are allowed to put nails in the walls and who is responsible for garden maintenance.
  3. Nuisance. Make it clear in writing that student tenants must be respectful of the neighbours in terms of behaviour and noise. This will assist in settling any issues that arise at a later date.

You can find the latest version of the Government’s model tenancy agreement on the GOV.UK website. If you want to make any amendments or additions, it’s important to seek legal advice to make sure they are valid, enforceable and don’t breach any of the tenants’ rights. Read more about what to include in an HMO tenancy agreement here.

The check-in process

It’s crucial that you conduct a thorough check-in with your tenants. This gives you the opportunity to talk them through the inventory and any other information they need to know – such as how to operate the heating and the most efficient settings for the washing machine.

Remember, this may be your tenants’ first time living independently, so it’s a good idea to give them practical advice on how to maintain the property.

It’s helpful to provide a ‘welcome pack’ that your tenants can refer to throughout the tenancy. This should include:

  • Contact details for the property manager
  • Details of what to do and who to contact in an emergency
  • Copies of instruction manuals for appliances
  • Copies of the gas and electrical safety certificates, and the EPC
  • A copy of the check-in inventory
  • Broadband WiFi password / connection details
  • Information on the local area and amenities – including bus routes, local taxi numbers and even take-away menus
  • A reminder about being considerate of neighbours, particularly regarding noise late at night  
  • A reminder that you will be carrying out regular property inspections (which are normally required by landlord insurance policies)

We’d also suggest the most important contact and fire safety information is clearly displayed on a notice board in the kitchen. Make sure the tenants all sign a copy of the inventory to confirm they agree with the details and description of the property contents, which should be in writing with accompanying photographs.

Although it may take a little time to go through the inventory with them, it’s important to have a clear record of the condition of the property at the start of the tenancy that can be compared to the condition at check-out and used as evidence if you want to make any deductions from the tenants’ deposits.

Maintaining good communication with student tenants

Good communication is key to a successful tenancy and one of the most crucial elements of letting to students. For many, this will be their first foray into independent living, and with so little experience of the rental market, they may be very aware that someone might try and take advantage of them.

In this situation, having a landlord they feel comfortable with and know they can trust means a lot. You may sometimes feel more like a parent than a landlord, but the better a relationship you can foster with them, the more successful the tenancy is likely to be.

The best way to earn their trust is to be friendly, honest and open with them from the start. If there’s any aspect of the property that’s less than ideal, be upfront about it, and ask if there’s anything you can provide that would make them more comfortable – within reason!

Be clear on what you expect from them as tenants, but make sure they know they can come to you at any time with questions or concerns.

Importantly, make sure you deliver on your promises so the tenants know they can rely on you. Respond quickly to any queries and have issues fixed as soon as possible. If things are taking longer than expected to resolve, keep your tenants informed so they know they’re not being ignored and haven’t been forgotten.

Top tip: Start off on the right foot by having a little welcome gift for your student tenants when they move in – perhaps a mini-hamper or some wine to share. It’s also a good idea to supply them with a few basic cleaning products to help them keep the property looking good, such as stain remover and toilet cleaner.

The check-out process

As soon as your tenants give notice they will be moving out, make sure they know what the check-out process will be, giving them plenty of time to prepare.

Remind them they need to hand back the property to you in the same condition as it was when they moved in – with allowances for natural wear and tear. Make it clear to your tenants that it’s their responsibility to clean and tidy the property, including any appliances – and especially the oven – before they move out and make sure they’ve complied with their maintenance responsibilities as outlined in the tenancy agreement – such as keeping the garden tidy. You can help the students prepare for check-out by giving them a cleaning checklist and reminding them that if there’s any confusion, they can refer back to the check-in inventory.

Ask the tenants to be present for the check-out inspection, so they can answer any questions you might have and you can agree any deposit deductions there and then.

Dealing with deposits

Deposits for students are not dealt with any differently to normal deposits and they will need protecting in one of the government approved schemes such as mydeposits or, if the student struggles to raise the deposit monies, in a deposit replacement scheme, such as Ome.

However, there are lots of differences between your average tenant and student tenants when it comes to who might pay the deposit and what you may need to claim for at the end of the tenancy, so we’ve created a specific article – Deposits for student lets – a landlord’s guide.

Anti-social behaviour

When there are problems with a student tenancy, it’s often to do with anti-social behaviour. The most common complaints are about noise, but anti-social behaviour can also include things like refusal to empty bins, intruding on other people’s property or privacy, and abusive actions.

As the landlord of a student property, it’s a good idea to introduce yourself to the neighbours and let them know that they can contact you directly if they have any concerns or problems with your tenants.

You should address any anti-social behaviour as soon as you are made aware of it. Provided you’re happy it’s safe to do so, arrange to visit your tenants in person to discuss the problem and remind them of their legal obligations under the terms of the tenancy agreement. Also remind them that if they breach their contract, you may need to evict them.

Of course, it’s important to hear their side of the story as well but, ultimately, if there has been a complaint, it’s got to be taken seriously – not least because your reputation as a landlord is at stake. If you decide to take action against tenants because of persistent anti-social behaviour, you have a number of options.

One route is mediation, which can often be the best solution to diffuse any conflict and make sure the problem doesn’t escalate. The government-authorised Property Redress Scheme offers a tenancy mediation service for landlords. Or you could choose to evict your tenants.

If the initial fixed term of the tenancy agreement has expired or is within two months of expiring, you can serve a Section 21 notice giving them two months’ notice to leave. The other option is to use a Section 8 notice (Form 3), which can be issued at any point during the tenancy. You must state the ground(s) on which you are evicting the tenants and the minimum notice period will depend on the ground. For ground 7A (anti-social behaviour) you must give at least one month’s notice. Because you are required to follow a specific legal eviction process and getting any part of it wrong can delay or even invalidate the eviction, it’s advisable to take specialist advice.

Using a professional company to administer the eviction – such the Landlord Action, part of the HFIS group – will make sure things are done right and the tenants are removed from the property as quickly as possible. In the case of extreme anti-social behaviour and if you or anyone else feels threatened by the tenants, you can contact the police to deal with the situation right away.

How to reduce damage to student properties

Any HMO is likely to suffer more wear and tear than a single-let property, simply due to the number of unrelated occupants. If the tenants are young students – particularly if this is the first time they’ve lived independently and they’re not used to managing and maintaining a home – there’s an even greater risk of damage to the property and contents.

All the advice in this guide so far will help you choose the right tenants and make sure your relationship runs as smoothly as possible. Here, we look at the steps you can take to reduce the likelihood of damage and protect yourself financially.

Fit out your property carefully

Making the property attractive, comfortable and easy to keep clean should encourage your tenants to look after it.

  • Have hard-wearing fixtures and fittings that will withstand heavy use, making sure cupboards and wardrobes have sturdy hinges
  • Make sure curtain poles and blinds are securely fitted
  • Use durable, wipe-clean paint on the walls and woodwork, and mould-resistant paint on ceilings – particularly the bathroom and kitchen where moisture tends to collect
  • Fully tile the bathroom – walls and floor
  • Install good quality and durable flooring – find out more in mydeposits guide to the best flooring for landlords and tenants
  • Have comfortable furniture and a few furnishings and accessories to make the place look like home – such as lamps, cushions and perhaps a couple of easy-care green plants

Use an inventory

Before your tenants move in, have an independent inventory clerk make a detailed inventory of all your fixtures, fittings, contents and décor. This should include photographs and comprehensive details about the condition of each item. Have all your tenants sign this inventory at check-in to verify the contents and make sure they understand that you expect the property to be returned at the end of the tenancy in the same condition – emphasising the kind of minor damage that will be accepted as natural wear and tear.

Educate the tenants

When you check the tenants in, highlight the clauses in the tenancy agreement that relate to minimising the risk of damage.

Giving them clear guidelines – such as not putting nails in the walls and keeping the garden tidy – will help make sure there is no ambiguity around what is permitted and what is not. Then provide some practical information on maintaining the property, such as:

  • The location of the stopcock in case there’s a water leak
  • The importance of airing the property regularly and wiping away any condensation to avoid mould forming – there’s lots more advice on this in our guide to preventing damp and mould
  • Guidance on heating the property in colder months to minimise the chance of mould and burst pipes – read more on how to avoid burst pipes in your rental property
  • How to tackle spillages so they don’t stain – perhaps provide them with some good stain removal spray

Arrange periodical inspections

In addition to checks at the beginning and end of a tenancy, you should arrange to make inspections of the property at regular intervals – we’d suggest at least once every three to six months for student tenants.

This will make sure you pick up any maintenance and repair issues that the tenants might not have reported, which should help prevent serious damage over time. Pay particular attention to your property during the winter months and build relationships with reliable contractors that you know will respond quickly, especially if you have multiple properties.

You’ll also be able to judge how well the tenants are looking after their rented home and bring up anything you’d like them to do differently.

Importantly, take the opportunity to check that the students are happy living there and ask if there’s anything they need. This may be the first time they have lived independently, and you might find you need to make more suggestions and give more advice than you would with seasoned tenants.

It’s also important to check whether any new occupiers have moved in that you didn’t know about, such as a boyfriend/girlfriend of an existing tenant. Firstly, any new residents must be referenced and right to rent checks made to make sure they are not in the UK illegally. And, secondly, increasing the number of people living in the property can affect licensing:

  1. It may make the property subject to licensing (if it wasn’t already)
  2. If you have a licence and it limits the number of permitted occupiers, the conditions may be breached

In any of these cases, you as the landlord will be held liable, so it’s worth reinforcing to your tenants that they must communicate with you if they wish to have any new house sharers.

Write the frequency of these inspections into the tenancy agreement, including the amount of notice you will provide before arriving, which must be a minimum of 24 hours. Bear in mind that the tenants are within their rights to refuse entry, so it’s well worth making sure you maintain a good relationship with them, and that they understand why inspections are important. You can read more about inspecting your property in our ultimate guide to inspecting your property.

Insure your property with a tailored landlord insurance policy

Even if you’ve taken all possible precautions to minimise damage to your property, sometimes accidents do happen and we have seen thousands of instances where landlords would have been left out of pocket if they hadn’t had adequate landlord insurance cover in place. A specialised policy, like Total Landlord’s Premier policy, can cover you for both accidental and malicious damage, as well as loss of rent and the legal cost of any disputes. If you’d like to discuss your requirements and get a quote, you can contact our team at any time via our website.

To find out more about our student landlord insurance, click here.

Maximising your profits from a student home

Maximising your rental profits is about three key things:

  • Getting as much rental income as possible
  • Keeping your costs as low as possible
  • Investing in a tax-efficient way

Many investors manage to buy a great property, refurbish it well and let it to reliable tenants – and then move on to the next project. They take their eye off the financial ball and fail to carry out regular income and expenditure reviews. Most significantly, too many simply don’t properly consider tax-effective property ownership, meaning they end up giving away far more of their profits than necessary to HMRC.

Property tax is a hugely complicated area, so it’s highly advisable to consult a financial adviser who understands buy to let and/or a property tax specialist before you invest. They can help make sure the property is owned in the most tax-efficient way for the long-term and that rental profits are also taken in such a way that your ongoing tax liability is kept to a minimum.

For information on your tax obligations and some of the ways you can reduce your tax liability, head to our comprehensive guide to taxes for UK landlords.

Here, we take a look at how to maximise your letting profits by looking after your cash flow and expenses and managing your liabilities.

1. Keep good financial records

This is key to being able to complete accurate tax returns and take full advantage of the expense deductions and allowances you’re entitled to.

Because property tax is complicated, and especially if you have multiple properties, it’s worth considering using a bookkeeper or accountant to maintain your financial records on an ongoing basis. They will know exactly which expenses are tax-deductible and whether they are revenue or capital items – that’s whether they should be deducted from your rental profits or offset against your capital gains when you eventually sell or pass on the property.

Alternatively, if you have the time and inclination, there are some great software packages specifically designed for self-managing landlords that can help track not only your financial transactions, but also other information about your property/ies and tenants.

2. Manage the property yourself

If you live a distance from your investment or work full time, you may prefer to let through an agent, who will find the tenants, collect the rent and handle tenant enquiries and small repairs. For guidance on working with a letting agent, read our Ultimate guide to choosing a letting agent.

A full-management service for HMOs is likely to cost around 15 per cent plus VAT of the annual rent. If you have more than one property, you may be able to negotiate a discount on the fees – some will let for 12 per cent.

But if maximising rental income is a priority and you live close to your investment, you may prefer to manage it yourself. Obviously, your time has a value and private rented sector legislation is increasingly complex to keep up with, but this is one way to keep your costs down and the more experience you get being an HMO landlord, the smoother things will run over time.

3. Join a landlord association

If you’re self-managing, consider joining the National Residential Landlords Association (NRLA), which offers a lot of administrative resources (including tenancy agreements), training and legal support to its members.

And if there’s a local landlord association, it’s worth joining that as well to help you stay up to date with what’s happening at a local council level and put you in touch with other student landlords.

4. Review rents every year

It’s important to recognise that if your rental income doesn’t increase in line with inflation, you will be making less profit in real terms, so you should try to make small annual increases to your tenants’ rent.

When it comes to student lets, where you may have a change of tenants each year, this can be relatively easy.

However, even if you have the same tenants for two or three years, who always pay on time and in full and don’t cause you any problems, it’s still worth considering as your costs may well have gone up, particularly with the cost of living issues experienced in 2022.

5. Reduce expenses

If you’re not able or don’t want to increase the rent, see if you can reduce your expenses, although this can be tricky.

Assuming you shopped around for the best prices from suppliers and tradesmen when you first let the property, there might not be much room for manoeuvre. And bear in mind that there is usually a trade-off between service/quality and price – you tend to get what you pay for!

However, here are some tips for keeping your outgoings to a minimum:

  • Always get quotes from tradesmen before engaging them, even if you’ve used them before, so they know you’re keeping an eye on costs
  • Have your property painted in the same colour throughout so you can buy in bulk, and choose something that’s part of a major supplier’s standard range. Go for a hard-wearing, wipe-clean finish, which should help keep redecoration costs to a minimum
  • Choose sofas with removable covers that can easily be washed and replaced and pass the first safety requirements
  • Encourage your tenants to let you know as soon as there’s an issue so you can have it fixed before it becomes a bigger and more expensive problem
  • Make periodical property inspections to pick up any general maintenance and repair issues or make sure your agent will do this for you and send you a full report each time

Although tricky, ideally review deals with utility and service providers every six months.

Some may offer you a discount if you call and say you are reviewing your deal and need them to offer you the best one they can.

6. Review your mortgage regularly

If you have a mortgage, it’s likely to be your biggest monthly outgoing. Even a small percentage reduction in the interest can make a significant difference to your profits, so it’s worth checking on the latest deals every six to twelve months. If you have a mortgage broker, they may be carrying out automatic reviews periodically on your behalf and should let you know as and when it might be worth switching.

Even if you’re currently on a fixed mortgage and within a tie-in period, it may be worth paying the redemption penalty to secure a better/cheaper deal. And if you haven’t remortgaged for several years and your property has gone up in value, you may be able to access better interest rates by refinancing at a lower loan to value.

If you’d like to discuss mortgage options for your HMO, simply contact the team at Hamilton Fraser Total Landlord Mortgages – it’s quick and easy, call on 0333 224 8918 for a bespoke quotation.

If your student rental is an HMO, you will need a specialist mortgage. These mortgages have some key differences to standard buy to let mortgages, which may include:

  • Lenders only considering experienced landlords
  • Maximum LTV ratios typically being lower – somewhere between 60 -75 per cent
  • Lenders insisting on certain requirements relating to the property

If you do require an HMO mortgage, it’s highly advisable to use a specialist broker, who can help you navigate all the various restrictions and conditions to find a suitable lender and product.

7. Avoid rental voids

Having your rental property standing empty is one of the biggest threats to your profits. Despite not having any rental income, you will still have regular costs to cover, such as mortgage payments and your insurance premium – so it’s a double hit to your pocket.

The good news is that because the rental cycle for students generally follows the academic year and they rarely want to move during that time, it’s fairly straightforward to plan ahead.

Check around December/January whether your current tenants are planning to stay on. If not, list your property at the local university’s housing fair, which usually takes place in January, and make sure you have new tenants lined up well before the current students move out.

Top tip: Consider making it easy for tenants to manage their finances by giving them an all-inclusive rent package that includes utilities, WiFi and contents insurance, which is what most university halls offer.

Buy to let investment is a business and being a student landlord requires the same business-like approach as for any other type of let. You need to plan ahead, budget well, monitor your finances and make sure you’re investing in the most tax-efficient approach right from the start, so you hang on to as much of your profits as possible.

With student HMOs, there are even more rules and regulations to know about and stay up to date with, and it’s especially important to understand your target market and focus on clear, open communication. There’s a lot to think about and get to grips with, but if you’re prepared to dedicate the time required to be a successful hands-on student landlord, you can end up with a very profitable business.

For a landlord’s perspective on student lets, read our Landlord Voice article on student lettings by Tom Entwistle, founder of LandlordZONE and residential and commercial landlord since the 1970s. Tom shares his insights on what has changed in the student market post pandemic, whether he thinks student lets can still pay, and how small landlords can compete against the big build to rent operators. Want a simple way to check you’ve done everything you need to do as a student landlord? Download our student letting checklist.

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