31/03/2026
As mentioned in an earlier article, the Renters’ Rights Bill has now received Royal Assent, making it the Renters’ Rights Act 2025 (the Act) and whilst there are provisions still to come into force, this article explores the impact on the student accommodation market and how we see there being a market shift as a result.
Tenancy reform
A key provision for the Act will see all assured shorthold tenancies (ASTs) automatically become assured periodic tenancies and as such, there will be no more fixed term tenancies and no rights for landlords to end a tenancy using section 21 notices – known as “no-fault” evictions. The latter being a familiar process for many landlords who have been granting ASTs for decades.
The changes will have a knock-on effect for many private landlords across all residential sectors, including the student housing market, as it will mean that possession of a property can only regained in reliance on a specified ground for possession. We have focused on one of the new grounds further below.
There are a number of other changes being made by the Act that will also have an impact on the student housing market. The changes will apply to all tenancies (including those already in existence) with effect from 1 May 2026.
Rent in advance
Section 8 of the Act introduces restrictions on a landlord from being able to seek more than one months’ rent in advance. This is to prevent those with deeper pockets being able to gain an advantage in bidding wars.
A consequence of this, however, is that it will affect the ability of international students to secure private rented accommodation as they are often unable to offer UK based guarantors or security and in place of this, are often prepared to pay a full year’s rent up front. In the absence of being able to ask for more than one month’s rent in advance, landlords will have limited alternative means with which to protect their interests.
Ground 4A
This is one of the new grounds for possession, introduced by the new Act, which will allow landlords of houses in multiple occupation (HMOs) let to full-time students to recover possession in order to provide it to a new group of students in the next academic year.
A landlord will need to have given to the tenants, before the tenancy is entered into, a written statement of the landlord’s wish to rely on this ground in future. For those assured shorthold tenancies which will automatically convert to assured periodic tenancies once that part of the Act comes into force, the landlord will need to provide notice of their intention to use the new ground within one month of the new rules taking effect.
In order to rely on this ground for possession, the landlord must provide a minimum of four months’ notice which must take effect between June 1 and September 30 in that year. This aligns with the usual university academic year. Given these limitations, there are likely to be some students who this will not apply to – for example those undertaking post graduate courses.
Ground 4A is only applicable to HMO student lettings. Therefore, any landlords who let non-HMO properties to students (one or two bedroom properties or studio flats) will not be able to rely on this. These will be subject to the same regime as non-student private sector lettings. This may lead to a reduction in the availability of smaller properties in the private rented sector for the student market.
It is also only available where the tenancy was not entered into more than 6 months in advance – this is likely to impact the way in which the private sector student accommodation market operates as lettings are often agreed before Christmas for the following academic year. The market will have to adapt to this new limitation if parties want to rely on Ground 4A.
Purpose Built Student Accommodation (PBSA) Implications
There are no changes to the existing exemptions from the Housing Act 1988 for providers of PBSA who are an educational institution, meaning the above changes will not apply to the properties they own and manage.
The Act will see other PBSA also being exempt where those providers are “a specified body of persons” – a key requirement of this is that they will need to have membership of a “housing management code of practice”, which is defined in the Act as meaning “a code of practice approved by the Secretary of State under section 233 of the Housing Act 2004”. This includes the “ANUK/Unipol National Code for accommodation owned or managed by non educational establishments” confirmed by recent regulations.
New PBSA tenancies granted by providers that meet the above requirements will be outside of the new assured periodic tenancy. These exemptions will also not act retrospectively, meaning that any existing tenancy will automatically convert to an assured tenancy on 1 May 2026 with the exemption only being able to be relied on for future cohorts of students.
Therefore, whilst PBSA will be less impacted by the main changes brought in by the Act than the private student housing sector, it is possible that PBSA accommodation will become a more attractive option to students, which may prove especially challenging to those universities with limited PBSA stock and who have traditionally relied on accommodation in the private rented sector.
From the PBSA operator’s perspective, the changes will see more favourable conditions make PBSA more attractive due to the certainty of academic years. Aligned with the exclusion of the restriction on up front rental payments, this clarity will make PBSA the only realistic choice available to many overseas students, who may not be able to offer a UK based rental guarantor. The market will have to adapt to find new solutions to that particular dynamic.
A key differentiator to date in the market has been the price points between PBSA and the private student rental sector. However if private student landlords now need to price in the risk of rental voids caused by students being able to determine their tenancies on 2 months’ notice, this advantage will be eroded. The true tipping point of the market will always come when the price between the two types of stock becomes negligible, the feeling always being that the corporate, professional service driven offering would drive students towards PBSA. The legislation could very well be the driving force in that respect.
The challenges brought in by the new Act may also see private landlords withdraw from the student lettings market, causing further demand and uncertainty for students. As these properties fall out of the stock, so too will their HMO status and we anticipate a greater number will be swallowed up for more traditional private residential use. This reduction in numbers of that part of the market will simply serve to drive up competition for PBSA, which will doubtlessly drive-up rents, bring forward letting renewal dates and make future developments more vital to the student population.
One unintended consequence of this will certainly see some UK students decide to either study whilst living at home or abandon their higher education plans altogether. Only time will tell in this regard, UK universities with good quality accommodation stock of their own supplanted with quality private PBSA will continue to flourish and, on the whole, such universities are within the Russell Group or equivalent. Other institutions may need to reposition themselves towards students commuting from their homes.
The changes brought in by the new Act, and to be set out in the raft of secondary legislation, will be complex to navigate both for students as well as universities and other providers with in house student accommodation teams who regularly advise their students. It will impact those who are actively investing, developing, operating or funding PBSA schemes too.
Should you require further advice and guidance, please do not hesitate contact Daniel Halstead, Helen Taller or Sarah Orchard.
For more information, you can catch up on our webinar. The session focuses on student tenancies, arrangements, emerging compliance risks and the practical steps higher education institutions should be taking now to prepare. Click here to watch the webinar.
You can also find more resources on our Renters’ Rights Explained page.
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