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So the government wants student rents to rise even faster?

19th April 2008 | back to article listings BACK    print this article PRINT

More silly government interference in housing proposed but unlikely to see the light of day. The intended review by CLG into the clustering of student housing in dedicated student areas of a town causing alleged problems in the community such as high vacancy rates in the summer completely misses the point and is superfluous in light of existing legislation. Local government already has existing HMO (Housing in multiple occupation) legislation that allows them to deal with the approval of housing for occupation by multiple individuals such as students and if a problem was genuinely being caused locally the HMO licensing procedure could be used to limit such property use and/or direct it elsewhere. There is no requirement for central government to attempt further legislation pushing further forwards towards a "nanny state".

Student housing is in very short supply in the UK given other government initiatives to increase student numbers aggressively year-on-year. Universities themselves are reducing their own dedicated student housing in the face of rising costs and limited budgets and the private sector that builds private halls of residence is constantly under pressure and limitation from local planners. Traditional housing for students is the safety valve for this huge demand.

Student rents have gone up 31% in the last two years alone and any kind of implementation by the CLG of further student housing restrictions would cause tremendous further rental inflation to the student sector as well as forcing students out into more far-flung locations and into traditional suburbia. Trying to spread student housing across the whole city instead of into dedicated student areas will create a vast number of complaints from NIMBYs as the naturally gregarious and boisterous student lifestyle encroaches onto leafy suburbia across the whole city rather than in one localised area.

Our view is that focused clustering of student accommodation in housing close to the university campus in a given town is very healthy for all concerned and with students staying over more often than not for the summer period, the extent of the student ghost town risk that the CLG quotes probably only extends to a few weeks at the most in August. Perhaps the next focus by the CLG would be city workers being banned from going on holiday at the same time in August when it too becomes a bit of a ghost town for this month.

This news story has come from the property investment blog by Stuart Law, CEO Assetz plc.

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