Investing in the Future of Student Living, HMOs, Market Trends, Student Wellbeing PLUS Ask the Experts feature on the Renters’ Rights Bill

Season 3, Episode 10 of the Housed Podcast.

Sarah Canning, Deenie Lee, and Dan Smith are back, discussing all things student living:
- Why supporting student wellbeing shouldn't be competitive 
- Are the latest PBSA operator updates indicative of the market as a whole?
- UCAS data - what does this signify for the future of student accommodation, BTR and coliving?
- The COHO Future of HMOs report

PLUS, Hollie Jordan-Wright  from Howard Kennedy tackles your questions about the Renters’ Rights Bill.

Our sponsor for this season, theEword  are true experts in digital marketing specifically for the property sector.

We are also delighted that MyStudentHalls are continuing to sponsor the podcast, Mystudenthalls.com - Find your ideal student accommodation across the UK.

Each week, Sarah Canning, Deenie Lee of The Property Marketing Strategists and Daniel Smith of RESI Consultancy will be delving into a wide variety of subjects and asking the questions that aren't often asked. This podcast is for anyone who works in Student Accommodation, BTR, Co-living, Later Living, university accommodation, Operational Real Estate or Shared Living.

Disclaimer: The views and opinions expressed in this podcast are the personal views of the individual hosts and guests.

Transcript

SPEAKER_05: 0:00

Hello and welcome to the 10th episode of Housed, the shared living podcast. I'm Sarah Canning from the Property Marketing Strategists.

SPEAKER_02: 0:07

I'm Dan Smith from Resi Consultancy.

SPEAKER_05: 0:09

And I'm Deanie

SPEAKER_06: 0:09

Lee from the Property Marketing Strategists.

SPEAKER_03: 0:12

Let's hear a word from our sponsor. This episode of Housed, the shared living podcast, is brought to you by the E-Word. digital experts in driving leads and putting people in your places.

SPEAKER_05: 0:22

We are delighted to have the eWord as sponsors of this season. The service and insight they provide the sector on their digital marketing advertising services is second to none. So get in touch with them if you haven't already. And also a huge thank you to Dan and the team at My Student Halls who are also sponsoring this season. More from them later. Now, later in this episode, we'll be hearing from Holly from Howard Kennedy answering your questions about the renter's rights bill. So stay tuned for that. You absolutely delivered on sending your questions in and we were delighted to get so many of them answered by Holly. So we'll be going to her later. In the meantime, it's been quite a newsy couple of weeks. Obviously we had our episode last week with Matt Christie from UK Reef. So we've kind of got a couple of weeks of all of the news from the sector to round up on. One thing that caught my eye last week was Student Roost and others from the sector launching their mental health support campaign, which is, you know, it's really, really great that they, I guess, shone a light on it. And I think what that did was instigate kind of the other operators who were already doing it coming out and saying, yes, we do that. We do that already. We were the first to do that. We, you know, but who cares? And I think that was Student Roost's point really is that this shouldn't be competitive. You know, everybody in the sector should be doing the right thing to support their residents. I think what it does show, and Dini and I have really been kind of majoring on this in our sales training, is a lot of operators don't talk about the great things that they do, you know, particularly if initiatives become business as usual, really. You know, so I think actually sometimes it does need something to kind of prove the catalyst that actually if you're doing great things, you should talk about it and make sure that your potential residents know all about it. What do you guys think?

SPEAKER_02: 2:09

I love seeing that. Yeah. So it was Caroline Cockle who sent that to me. I know that her and Lowry Edwards had worked very closely on that student roost with other operators as well, like Yugo, Fusion Group, Luna Students, and obviously the other Graystar brands, Canvas and Chapter. I just think it's great to see that there's no competition in compassion. That was my LinkedIn headline for it. And I would like to see more of that. Why would you try and reinvent the wheel when you could do it together for something that's beneficial and shouldn't be seen as something that's a competitive advantage? This is to benefit every student out there. So I just think it's a really worthwhile initiative. Definitely worth reaching out to Caroline if you want to get involved, if you're an operator. I know she's had quite a few approaches since that. And it all coincided with uni mental health day and that did have quite a few other operators putting out on linkedin and various other places that they do things as well the likes of unite of course we know they're going to do fantastic things with mental health and there's mental health support but what i liked about the initiative at student roost which is is behind every door it's the partnership that they've got with a charity called chasing the stigma and i just think there's definitely something in that collaboration when it comes to things like that so yeah let's see more of that please.

SPEAKER_06: 3:29

It's absolutely brilliant and it's absolutely what the sector should be doing and I think as we always say that collaboration is key and it is great to see that actually this is about the sector working together and sharing best practice and resources as opposed to trying to keep it for themselves. In my lifetime I did run a kind of a sector mental health conference back in the day. And one of the things, overwhelming things that kind of I learned from that when we got a series of experts in a room talking about how we can actually provide support is as a sector, we're not there to help people who have serious mental health illnesses. because they're not trained to do that. You know, yes, be a mental health first aider. Yes, know where to signpost them. But the role that we can have and the role that I think is most powerful to us is helping people being that safety net so they don't fall down. Actually, they get help at the right point, not when they've fallen down the hole and in a deeper place. So I think having these opportunities and services to be able to call people when actually you're just not feeling quite right is the bit that's really going to help with mental health. And I think that is what is really good about this and as you say Sarah I think lots of operators already have these abilities to kind of call people when you're feeling low and you're feeling you need help and they've got all those resources there but they're not telling them enough and this comes down to what we've said before is that we just need better comms We need to not rely on busy operations people to do all the telling. We need to actually make sure we've got dedicated comms that say when you move in, if you're feeling like this, this is where you call, this is the process, this is what you're doing. We just don't do that well enough, I don't think.

SPEAKER_05: 5:04

Yeah, no, no, agree. And I think that's something that the sector, hopefully, like I said, this might have just given them a bit of a boot to say, hold on, if they're all talking about it, we already do this. So if we as a sector will double down on the comms about supporting students and it's only going to be a positive thing. Other things in the news and a bit of a market update, really. I know, Dan, you've been digesting the Unite and Empiric report on how they're doing. And that kind of coincided with UCAS releasing their update as well. So, Dan, what have you kind of learned about Unite and Empiric? And did the UCAS data kind of corroborate with what those two big operators are saying?

SPEAKER_02: 5:46

Yeah, it's an interesting position for the whole sector to be able to see what, you know, two very large and very professional outfits are, you know, how they're doing across the course of the years. So both of them have just released their 2024 reports. Different Times Unites came out in February and Empirics has only recently come out. And it does show where they're up to year on year. You know, last year, Yeah, great. 8.2% rental increase for Unite, about 97, 98% occupancy. Empiric, 9.8% rent increase, again, about 97.5% occupancy. But... Both of those are, for this current year, behind in terms of their sales velocity. Now, Unite are 9% behind year on year. And Empiric, I think, based on the graph that I can see, are around 15% behind year on year in terms of their sales velocity. So that points to much more of a challenging year than it was this time last year. And incidentally, what I'm seeing with each of the comparisons and some of the graphs that we're starting to see is that Empiric, for example, are comparing this current year with 1920 to showcase this year in a positive light. And, you know, because you can't do that, you know, year on year for last year. They have still put year on year last year. So you can see that it's not like anyone's hiding any information here. I think it's further down the report than, you know, that I wouldn't expect to see it in the executive summary or right at the top saying, actually, we're having a bit of a tougher year than we did this time last year. That is, I think, endemic across the sector. At the moment, I think people are finding it tough. Some of them are reaching out and saying, yeah, we're finding it tough. What are you seeing out there in the market? And we're doing various different market reports at Resi Consultancy to really start to understand where the universities are sitting and which cities might actually be struggling. But it does feel like it's across the board from some big operators and small. They are putting their hands up and just saying, yeah, this is actually going to be a really tough year from what they can see. Now, the latest report UCAS report and data that came out effectively was showing a nice increase in the January numbers. So sort of 8.9% up for Chinese students, small percentage increase for domestic students. I think that people have seen that and thought, oh, it should be quite easy for us this year. But what happens if the market's actually front loaded? And actually, where are those students going? Are they actually living in PBSA or are they living in student HMOs or are they choosing other places? And I think that's where it just requires a market by market approach. I don't think you could say across the UK that there's going to be overall, it's going to be X or Y or you'll be drastically up or down, we're really starting to see some changes across certain regions, certain cities, and certain universities. It just requires a bit more granular detail, a bit of a real sort of deep dive into how each market is performing, I think. So yeah, that UCAS data was quite interesting from their latest report. So it's showing declining applications, but rising acceptances. You know, university applications actually fell in 2024. And this sort of suggests that they're becoming a bit more flexible with their admissions. potentially to kind of counteract the application drops that we've seen. UCAS also say that more students are living at home. Even when they move out, they are travelling further to campus. And this is sort of consistent across the UK. The number of students planning to live at home is actually at its highest in the last decade. Now, that, of course, is going to be driven by affordability concerns. I just don't think there's any other way of looking at that.

SPEAKER_05: 9:35

I think, yes, I think affordability, but also you know we do a lot of work with universities and i think what we see is the timetabling has a big impact it does go hand in hand with affordability but i think we're still seeing a lot of universities post pandemic that learn a lot about kind of virtual lessons and about timetabling we've also spoken to several universities who understand that their students are working and actually giving them more time to work and a set timetable is something that students work but the combination of that is students depending on what course they're doing and what university they're going at but there's a lot that do not need to be on campus five days a week and if you're not making that experience and that kind of need to be on campus five days a week and you only have to be on campus two or three days a week the UCAS report says that the majority of students who are not living at home are actually commuting 122 minutes average drive time which is fine I think if you're doing it two or three days a week that's that was the situation I was I was in when I was at university I was living in London and it was a horrible drive it took ages but actually because I was only needing to be on campus six hours a week there was no way that living on campus was an option really so you know we always talk about you know strategy doesn't start and end with marketing it's got to be a whole lined up approach and you know if universities if cities are having challenges with filling accommodation then the first thing that you know if I was a PBSA operator I would be talking to the university and asking them you know what their policy is how many days on average are the students going to be on campus because if that's not going to change then something else has to change you're not going to suddenly make students want to live away from home if the university has a blanket policy of limited days on campus and that could be cheaper accommodation because actually if it was cheaper then maybe it could persuade them to live away from home but you know this magic word of flexible living and flexible contracts, we're still not seeing any evidence of it whatsoever.

SPEAKER_06: 11:43

No, we're definitely not. And the other thing, though, is at play here is that if universities, we all know, are facing difficult financial circumstances, that they need to get students in. So ultimately, if students aren't coming because of affordability or other reasons, they're going to get them by any means. So it's ultimately in the accommodation providers' interest to go and start this conversation and talk about, well, how do we help you? And it's not going to be a this year fix. It might not be a next year fix, but if we don't do anything, we're going to end up in a situation where, which universities will do what they need to survive and they will survive and people just won't need accommodation which is what I've really been saying for the last three years I think if not longer and I just think it's now we've got to make a change because if you want to have a business in student accommodation from a societal side I think it's a great opportunity for young people to go out get independence and move away from and I don't think we as a society want to lose that experience but that aside if we want to have a business in student accommodation we need to think about how we can and help students be able to go and live and study at the same time.

SPEAKER_02: 12:50

How much of this can be solved by having a two-year degree, like six hours a week, realistically? What good is that going to do? It was actually Joss Murie who I was talking to just the other day about this. I just don't think anybody is really pushing the universities on it or offering this as a solution. Universities certainly don't seem to be doing it, and I don't see why not. It can solve a lot of those problems. And for someone like Joss, who is Joss is ultra focused on revenue. Let's be really clear about this. And so he's going to be thinking long-term, how can I deliver for my investors in particular, but also how can I deliver for the students? Primarily the investors though, I think. So ultimately, is there a case for a two-year degree? What do you guys think?

SPEAKER_06: 13:35

I agree. I think there is a case. I think it's the only thing that I might agree with Nigel Farage on. I mean, I think it's time to look at education full scale across the board, but yeah, I think it'd massively help.

SPEAKER_05: 13:45

Yeah, I think I've said this before, My niece did it was sort of during COVID, but it wasn't because of COVID. It was an events degree and they needed staff on campus to run their hotel and conferencing and wedding events. A lot of universities, I think we've said this before as well, won't do it because they're super, super reliant on the income that summer business brings to them, you know, on campus. Again, it's a strategic decision. What's your priority? Is it student and student outcome and accommodation potentially, you know, or is it income? income from summer events and some business. Now, that's not something that we can fix, but it is something that I think accommodation is quite often forgotten in these high level kind of income related strategic conversations. And if you haven't got anyone from accommodation around that table, then accommodation will suffer. And we have seen it with various different clients that something strategically changes at the university and no one thought to consider about the beds, the accommodation beds really. And I think what I've learned from this UCAS report is this is not going to change. And I don't think it's realistic in the PBSA sector to think, I'm just going to wait it out. They'll come. It will change this year. It will change next year. It will change next year. It's not going to. This is a monumental shift, how young people think. We're moving away from Gen Z to Gen Alpha. We're not seeing people researching Gen Alpha. Everyone's still talking about Gen Z. Gen Z, but actually, you know, if you're planning your future strategy and your future product, then you need to be thinking a bit about Gen Alpha. They grew up through COVID. They grew up seeing their parents largely working from home and working flexibly. You know, they are not, they don't have the nine to five office kind of environment as a goal because they'd never seen it. So we've got to kind of learn from these shifts. I think the other thing is from everybody that listens that's involved in co-living and BTR. Obviously, there's loads of students living in BTR and co-living. So any shifts with university students in your city will impact occupancy of BTR and co-living. But beyond that, if we're saying that a load less students are going to be moving away for university, that should be an alarm bell for BTR operators that there's less migration generally. A lot of the time, those working professionals stay in their city because they've gone to university there. But if they're not going to university there, why is a load of students going to suddenly move, young people, sorry, going to suddenly move to Newcastle or Birmingham or Southampton if they didn't do their degree there. So it's a big shift.

SPEAKER_02: 16:33

Great. And let's be clear, BTR is built on the foundation of students and international students in particular. I know that that is not a popular opinion, especially with the BTR community, but there is no denying it. There is no hiding behind the data that's being shown by the likes of Price, Hubble and various others that there is a huge proportion of students in BTR. So there's a knock-on effect to all of the living sectors, the alternative living sectors. So you're co-living, you're BTR or multifamily and you're PBSA, of course. So we just need to be mindful that some of these cities that are getting caught up in some of the sort of changing patterns and the affordability crisis that we see in student accommodation in particular. It's going to change drastically, and we're all seeing out of the back of this report from UCAS, increasing proportion of students living at home, but students in the north of England are less likely to move out, 63%, whereas students in the south are more mobile, about 79% of students are likely to move out. 58% of students in London, but the shrinkage is in student migration to the South. I think that's something to be really mindful of. So we've just got to start thinking about what's actually going to happen to some of these cities, especially the non-Russell Group cities as well in the South, but across the UK. So yeah, there's a lot to consider here in the face of some challenging international markets in particular. So I think that everybody needs to get a little bit more granular in terms of their approach to some of these forecasts.

SPEAKER_05: 18:07

I think what's really interesting, actually, and again, one to think for the future, is investment into infrastructure in the UK around travel could actually change this again, you know, because if people can commute easily, you know, so thinking about HS2, you know, or improved tram routes or, you know, bus routes between cities, that makes it even easier for people to commute. And unless as a university, you're mandating a five-day-a-week timetable, improved travel, and you'd like to hope that across the UK travel improvements are only going to get better and faster, then again, that's even less reason to move away from home.

SPEAKER_06: 18:47

I think you're more positive about the opportunity of improved travel infrastructure in the UK than me. Yeah, I blame beaching for a lot every single day. It feels we've gone backwards since then and we continue to do so. But yeah, you know, there is lots of things that can happen I think there's lots of things that are working to impact the sector around BTR around change of student preferences but my call out is that it's not for the sector to sit there and wait for universities to shift or the government to sort something else out actually for us to come to the table and say well we want to help you to house more students so how do we do that how do we work together to do that we can't sit on our laurels and I worry for far too long we've sat on our laurels on this

SPEAKER_02: 19:26

this goes back to the work that we've been doing with each of our clients and and what I sort of said at the start of the year we are moving moving into an era of flexibility and affordability. And you need to be able to offer both of those to your students if you're going to thrive. And I think that what we're seeing at the moment is international students are increasingly constrained in terms of the prices that they are able to reach within PBSA. So some of those platinum and gold studios, they are sitting vacant at the moment, where quite often previously they would have been taken up by this time. And I think there is a shift down towards the HMO sector and that more affordable sector as well. There are some brilliant operators operating in the premium sector who will be fine, but I think that everyone across the board, especially in the middle of the park, if they've got some higher priced rooms, they are sitting vacant at the moment. That's not everyone, of course, but the majority of clients that we work with, but also conversations that I'm having within the industry is saying, yeah, those golden platinum studios, they are getting harder and harder to shift. And yet, what are we building. We're building golden platinum studios because it's all that makes the numbers stack up at the moment. So we are definitely moving into the era of affordability and flexibility, but we aren't actually offering that at the moment. I think those operators and those universities that do offer that, either in terms of flexibility of shorter term sessions or semesters, or even a two year course for a university, if you're offering those and delivering for your students, then you will win

SPEAKER_05: 21:00

out. I was following a thread on my local Facebook group. And it was a parent saying, my grown up son lives with me. He earns£1,200 a month. Should I be asking him for rent? And if so, how much? And I was following this because as a student and working as well, I did have to help my parents out. They weren't in a financial position whereby they could afford the house that we were in and me not contribute. But actually, it was really interesting reading the response Thank you so much. home a lot longer than we've seen in the past as well and you know I certainly sense that from my own children really you know that those dreams of like you know down downsizing in five years time is just just not going to happen we're going to need space for our children for a lot longer you know and actually I guess probably my stepdaughter who is going to go to university we probably think she's least likely to come back and need a home but the boys who probably won't go to university that's not a gender thing by the way more than we're to go into the ins and outs of why that is. But yeah, you know, it's not like at 18, they're going to suddenly have the income to be able to move out of home. So that's why I think that we've got to look at the much kind of wider macro data. And, you know, we're all guilty of being in a LinkedIn echo chamber, you know, listening to the sector. So I think it's absolutely brilliant that there is a housing target. It seems like it's going ahead. It seems like everybody is supportive of this, but I'm still not convinced it's the right homes in the right places for the right people at the right price, you know, and that'll be a real shame. So any more news that we need to cover? There was a report, was it there, by Coho about kind of HMOs. Obviously the HMO sector is going to have a little bit of a tough couple of years with, with tighter regulation. And I think what this report really kind of highlights is you can still make a success out of being an HMO landlord. You've got to get the basics right and kind of having substandard quality is not going to be acceptable anymore. There is going to be no way of landlords kind of getting away with providing their tenants with anything less than good quality. They also talked about community that surely the pull of HMOs kind of for all of these years of shared occupancy is because they want to live with other people. So as a landlord, as an operator, as a letting agent, you've got to do everything in your power to make sure that those people living in that house together are getting what they need from their community as well. And that might be technology it might be like matching people successfully but also taking away those things of that cause conflict when people live together like like paying bills like i guess sort of you know you know massively disproportionate sized bedrooms making sure that there's enough social space for them etc so i think that's probably right i think that you know and what the renters rights bill wants to do is to and the epc act is to take away those bad quality homes really So I tend to agree with the report really is that there's definitely, and there has to still be a market for HMOs because they are cheaper and that is where people could afford to live, but it will take out those bad quality homes from the market.

SPEAKER_02: 24:49

I really hope so. I think that that is what it's designed to do. I think we'll see attrition from the traditional mom and pop shops, you know, your little individual landlords that have got a few properties here and there in favor of institutional investment. And that was, you know, it's interesting to see all the institutional investors that are just Just putting the feelers out there as to if there's any sort of student housing, HMO portfolios out there for sale. And I've been speaking with the guys at Rooms for You and Tom at Fat Properties and Greg White as well. I can see that that is the direction of travel. I think that with EPC legislation coming in, with the renter's rights bill, it's just going to mean that it's not as attractive anymore to run this on a smaller scale, to run your student housing portfolios on a smaller scale. So getting institutional investment where they can come in and do sustainability plays and also then deal with any shocks to the market. I think that is going to be probably how student HMO stays alive over the course of the next three to five years, realistically, because God knows we need it. You know, PBSA has shown that we aren't able to offer the affordability in key locations where student HMO can. And students are currently falling out of the bottom of PBSA into HMO, not necessarily because they actually want to, but because it is out of necessity from an affordability standpoint. So student HMOs on a hiding to nothing at the moment. It is a tough time to be a student HMO landlord with both of these regulations coming down the pipeline. So are we going to see more institutional investment? Yes, I think we will. Are we going to see more professionalization and scale? Yes, I think we will as well. But But each city needs to make sure that as and when some of these smaller student landlords do sell up, because some of them will, not all of them, but some of them will, that either there's institutional capital waiting in the wings to swoop in and take portfolios in that city, or that they've allowed enough PBSA to be built. That's why Nottingham is such a shining example of how to deal with the student housing crisis, the student housing affordability crisis in particular. because they're building as much pbsa as they can as coventry and sheffield have and now we're seeing bristol following suit and glasgow because they know that with student hmos leaving the market and they've got evidence to show that there is student hmo attrition that they will have enough pbsa built to lower the occupancy which will provide more competition and ensure that the prices drop because everyone knows that the best way to get students in your beds is typically by dropping prices or offering big incentives. And that will mean that average occupancy maybe sits around the 80% mark. I actually think in Nottingham, it's probably 75%. I think it's much lower than people are actually realizing, especially because I've just done some work on that recently in some other locations too. And at that point, you don't need to worry too much that there's that attrition student HMO because you've built enough PBSA and that price will regulate itself over time. At which point the universities are super happy because they know that they can offer affordable accommodation to their students and everybody wins. So, you know, having a joined up student housing strategy between the universities, the council, the planning department, the transport department and the private sector, you know, enabling and empowering the private sector to go and build that's, That's what we need to be doing across the UK.

SPEAKER_06: 28:24

I don't disagree with any of that, but I do think that it isn't just about building PBSA as we know it. We still need a product range in PBSA because it's not just build what you want and charge lower rent. It's we need a range of, you know, if you want a HMO style PBSA, it's here. If you want kind of all bells and whistles singing PBSA, it's here. And we don't have that. And that's what we need.

SPEAKER_02: 28:46

And stop just building studios. I think this is one of the key things. And it's one of the key things that that Nottingham in particular are trying to lead the way on with a 20% cap on studios. So we have to be really mindful of the fact that what happens in 2030 when that demographic dip is through and we've peaked and it starts to drop back down again, All these city planners need to be thinking about what that looks like beyond 2030 as well. So, yeah, I think we do need a bit of a mindset shift, but we do need to still be making sure that we are trying to build as affordable as possible, but a different range of stock. Like we can't keep building these studios.

SPEAKER_05: 29:23

Great. Well, we're going to go to a break to hear from our sponsor. And afterwards, we're going to be hearing from Holly Jordan-Bright from Howard Kennedy about the renter's rights bill. So let's hear from our sponsor. Thank you.

SPEAKER_00: 29:36

Thanks again

SPEAKER_05: 29:45

so much to My Student Halls for supporting us for a second season. We're so happy that you're with us and that our listeners are getting their properties listed where it matters. Now we're going to hear from Holly Jordan-Wright from Howard Kennedy, who's here to answer your questions about the renter's rights bill. Hi, Holly. Thank you so much for joining us.

SPEAKER_04: 30:04

Hi, Sarah. Thank you for having me.

SPEAKER_05: 30:05

So we're going to go straight into it because we were blown away by the numbers of questions that we had about the Renters' Rights Bill, which I think is indicative of kind of the mood of the sector, really. So the first question that we had was Laura Matthews from EPOC Rebel. She asked, what should PBSA operators be doing now to ensure their workplaces and operational policies align with the new requirements whilst also maintaining a positive customer experience?

SPEAKER_04: 30:32

Thanks, Sarah. Yeah, it's a really common question so the government has said that the bill will exempt purpose-built student accommodation from the assured tenancy system if the landlord is signed up to a government approved code of management practice and the code is currently being reviewed but we think it's likely to include a number of revisions and changes and that's going to relate to things like deposit protection and the adjudication process to resolve disputes improve flexibility for students leaving their institutions of study or not gaining a place to study and incorporating new legislation such as under the Building Safety Act, Fire Safety Act and title guidance on how to respond to damp and mould and complaints procedures. Now, if the anticipated exemption from the Renters' Rights Bill is implemented, then the idea is that fixed-term tenancies and variable rent payment periods will continue for PBSA tenancies. However, what you should be doing in the meantime is keeping your communication with your tenants so that they understand if any new changes are coming and keeping track of the Parliament as well as secondary legislation bringing in the PBSA exemption and the code requirements which as I say they're currently under review but we expect it to be in a final form around May 2025 and then with a view to the bill coming into law in the summer or autumn of 2025. Now we expect there to be a relatively short period between the final form of the legislation and it coming into law so it's really important that you keep on top of any developments so that you can be responsive to them and then taking advice on specific points of law particularly once the bill is in final form. And lastly, be ready to update your form of tenancy agreement once those changes are known.

SPEAKER_05: 32:10

Thank you, Holly. So I think that connects with Robin Moorcross from YouGo's question as well, who said, in that interim period, will PBSA be forced to follow the Renters' Rights Act without any exemptions, basically, and before that special status is implemented?

SPEAKER_04: 32:28

Yeah, it does cross over with that. So the idea is that the exemption will remove the assured state from private PBSA tenancies, as is currently the case with university managed accommodation, and that they would all then become common law tenancies. However, secondary legislation is needed to give the exemption, as it's not actually in the bill at the moment. Now, the government is saying that that's something relatively straightforward that they can do. So we do expect it to be brought into law along with the bill. But obviously, PBSA providers do need to comply with the requirements of the Renters' Rights Bill to avoid falling foul if it doesn't come into law. Although I will say that we do expect it to because the need for the exemption has been flagged by stakeholders at all stages of the bill and most recently in the House of Lords so we fully expect the exemption to come into force at the same time as the bill and if they don't then it will create absolute chaos in the sector which we are all hoping to avoid. That's

SPEAKER_05: 33:19

really helpful thank you and I think that covers off Derek Gu's question from the National Code as well so thank you for those questions around kind of PBSA status. One question that actually came up in a sales training session that I was with facilitating the other day from an operator, was obviously there's a lot in the renter's rights bill about discrimination. And obviously, that's why the renter's rights bill has largely been put in place to ensure that everybody has kind of equal, equitable footing to rent a property. Will any of that potentially apply to PBSA? The example that this operator had is, for example, pets. In PBSA, they don't allow pets for very good reason. Is that something that could be seen in pbsa in future

SPEAKER_04: 34:05

so we do expect that pbsa will be exempt from most of the discrimination grounds under the bill based on its current drafting and that's because the discrimination parts they apply to what's known as relevant tenancies and that under the bill means an assured tenancy within the meaning of the 1988 housing act now tenancies granted under the pbsa exemption assuming it comes into force are not assured tenancies within the meaning of that act however other aspects of the bill such as the ombudsman the private rented sector day database, decent home standard. Again those all don't apply to common law tenancies which PBSA tenancies will be if the exemption comes into force. However if exemption is linked to being a member of the code and membership is withdrawn or lapses then the tenancy would revert to an assured tenancy status and so those provisions of the renter's rights bill would apply. So it's really important that if you're a PBSA provider and your exemption is under the code that you maintain membership otherwise some of those provisions could end up applying for by default.

SPEAKER_05: 35:04

Thank you so much, Holly. That's really, really great advice. We've absolutely loved having you with us for this episode. We've got even more questions to answer. So you're going to join us again in a few episodes time to cover more of the renter's rights bill. But for now, I'm going to say thank you very much, Holly, and we'll see you again soon. Thank you. See you soon.

SPEAKER_01: 35:23

As one of the UK's largest real estate legal teams, Howard Kennedy brings deep industry insight and commercial solutions to support clients in an ever-evolving real estate landscape. We deliver tailored solutions that help our clients realise their goals, working in close collaboration to navigate every stage of the property lifecycle.

SPEAKER_05: 35:44

And that's a wrap on today's episode. So thank you to the E-Word for being our headline sponsor for the season. Your support is hugely appreciated. And of course, thank you to our friends at My Student Halls for joining us as a sponsor once again. Please subscribe to Al so you get the brand new episode every Friday. And if you could leave us a rating and a review, that would be fantastic. We'd love getting them via WhatsApp and email, but if you could rate and review us on your chosen podcast channel, that would be even more brilliant. Join us next week for another packed episode, including more legal answers from our experts, Al Kennedy. Thank you very much and see you again next week.