As part of our aim to keep abreast of the local market, we’re signed up to receive daily email alerts from Rightmove and Zoopla and puzzled by the fact that a large number of agents are still advertising empty student properties to let, we decided to have a closer look. Here we are Mid-October 2014, the student property market should have been closed weeks and weeks ago with everyone having hung up the ‘No-vacancy’ signs. Instead, as of the time of writing, there are 66 properties showing as still being available on Rightmove. That’s around 300 rooms.
Usually at this time of the year, there is a small handful of houses left and these are usually the deadest of dogs that you wouldn’t let your live dog live in, let alone real people. So, why the sea-change this year? We think there’s a number of possible reasons:-
- The number of incoming students to Norwich is down this year. (We have not seen any figures to substantiate this however).
- The UEA’s build programme of on-campus accommodation has absorbed the overflow into the Private Rented Sector (‘PRS’), previously evident.
- The UEA’s own newer accommodation is not only nice but is a darn sight cheaper too than going into the PRS which given the costs now faced by students overall, is a much more important consideration than before.
- There’s been a big influx of new landlords into the student property market, attracted by the headline returns seemingly on offer.
- The UEA’s own ‘Home Run’ system of advertising houses in January each year skews the market in favour of landlords who don’t use agents. (Agents are not allowed to list properties on the Home Run unless they agree not to charge any tenant fees).
- The UEA have recently set up a fee charging letting agency of their own and, allegedly, have prohibited new landlords from using the Home Run advertising medium unless they use the services of their agency. This will have driven those landlords into the arms of the professional agents.
In a nutshell then, the classic situation of Over Supply meets Under Demand!
We don’t see this problem getting any better for the next few years, in fact, here’s a gentlemen’s bet; this time next year, the number of unlet student properties still available on Rightmove will be 20% higher than this year.
If you’re one of the ‘Damned 66’ why not give us a call and we’ll chat you through the options – there are alternatives.
Martin & Co Norwich
10th October 2014