Mayoral elections, deposits and student lets

6 Jan 2020 11:44 AM

The Mayor of London, Sadiq Khan, is to put calls for rent controls in the capital at the heart of his campaign for re-election.

Speaking to Politico he has said that: “Fundamental change in the private rented sector in London is long overdue. More and more Londoners are renting long-term, including families and older people, and the law is simply not fit for purpose.”

Housing Secretary, Robert Jenrick, has warned he is “not in favour of rent controls”, arguing they have “proven to be very negative for both landlords and tenants in the past, with RLA research showing that rent controls have led to a lower standard of housing and less choice for tenants in cities across the world.

Tenants resorting to high interest loans to pay PRS deposits says insurance firm

A new rental deposit alternative scheme claims that some renters have to resort to high-interest payday lenders in order to afford a deposit.

Hamilton Fraser’s Ome scheme says that while many tenants can afford the typical UK deposit of £1,299 – either out of their own income or savings, or by borrowing from friends or family – some have to resort to more aggressive loan sources.

A tenant borrowing £1,299 from a payday lender and paying it back over the course of a year could face a rate of 292%, paying £341 a month and a lump of interest at £2,784.

‘Value for money’ the main factor for students choosing a rental home

An extensive survey of students, seeking their views on accommodation, has ended with a question mark over the value for money of some purpose-built accommodation.

The survey questioned 60,000 students between February and November last year, and was conducted on behalf of Knight Frank, in coordination with admissions body UCAS. It was the largest survey of its kind in the UK.

The key findings are:

• The single most important factor influencing the choice students make about where they live is value for money. Some 98% of respondents rated this as being important to them, with just under half rating it as “extremely important”;
• With regards to purpose-built student accommodation (PBSA) brand recognition was a key influence with 40% of new first year students living in private PBSA saying it was a factor in their decision of where to live;
• Some 78% of students living in PBSA were satisfied with their accommodation and 75% of students living in private PBSA would recommend their accommodation to new first years. But Knight Frank adds: “There are challenges, however. The most commonly cited reason for dissatisfaction among students living in privately operated PBSA related to it not being value for money”;
• On average students living in private PBSA are paying £7,990 per annum for their accommodation. This is a premium of 6% on the £7,550 average for those living in university-operated accommodation and 30% on the £6,130 for students living in privately rented house shares;
• Regardless of the type of accommodation they were living in, most students (82%) indicated that their accommodation costs were either affordable or just about affordable;
• 68% of students identified affordable living costs as being ‘very important’ with regards their overall wellbeing, whilst the standard of accommodation was also identified as a key factor, with 82% identifying it as either “important” or “very important”;
• Some 43% of international students said that the option to stay in the same accommodation for more than one year was “extremely important” or “very important” when deciding where to live.