What’s Happening With the Student Market in Norwich?

ELA have established many purposeful and positive relationships across the sector and Jon Champion of Champion Property Management is one of those, so we were really delighted when he agreed to join us this on the Blog this week as a guest writer. We find getting insight from incredibly knowledgeable industry professionals is such an advantage to our members who benefit from their specialist advice. Jon is sharing his comments on the current situation around student accommodation in the Norwich area.

Jon Champion, MD of Champion Property Management

After 15 years in the industry, I have seen a dramatic shift in the nature of the student rental market in the city.  

When tuition fees came in, we saw a migration of UEA students away from the previously popular Golden Triangle into West Earlham. However NUA students were happy to fill the void.

Previously ‘acceptable’ low standard student ‘digs’ no longer cut the mustard as expectations and standards have soared, partly to compete with the ever growing PBSA market that has finally reached our fine city.

Immigration changes in Australia even had an impact when the Chinese students found it easier to go study there instead of the UK, leaving the INTO building on campus operating at lower occupancy levels.

What are students looking for in their accommodation?

At Norwich Student Lettings, when looking for a house, we ask students to complete a questionnaire about their desires and needs, and we will then pair them up with the perfect house, saving everyone a lot of time.  This gives us some fantastic insights into what today’s students are looking for.  Here are the top 5:

1. Communal space

While not including adequate communal space may seem attractive from a profitability standpoint, it may not be a wise investment decision. 77% of students said having adequate personal space is important to them, with over half (53%) saying they would not rent a house with no lounge. Houses without a lounge could therefore alienate a large portion of the market, with tenants understandably valuing the mental health benefits of socialising and relaxation.

2. Location is everything

With an oversupply of rooms, students can be choosy, and don’t feel the need to compromise.  76% of students asked, said that being close to campus was important to them. Whilst you cannot move existing properties, new investments need to be as close to the campus you want to target as possible.  Bowthorpe and Threescore are no longer popular with students, and UEA students are not as interested in the Golden Triangle as they used to be. 23% wanted to be less than ½ mile to campus, whilst a whopping 82% said no more than 1 mile. 

3. Shower ratios

We all know that en-suites are popular, but in many cases are not practical due to drainage and plumbing restrictions.  Whilst an en-suite room will attract a premium rent, they are by no means essential for group tenancies.  Having said that, when it comes to individual room lets, they become much more important.

For the average student group on a joint AST, aim for a shower ratio of no less than 1 shower for every 3 people but ideally closer to 1:2 for more premium properties.

4. Parking

A surprising new entry at number 4 is parking. Living standards are going up, and what used to be a rare luxury for the wealthy is now being increasingly common.  Students often have cars, particularly at the higher end of the market. Consider parking space when looking at new investments, and try and accommodate cars for 50% of rooms.  Be aware that each house only qualifies for 2x on street parking permits in permit areas.

5. Modern décor

With the social media generation, we now have an aesthetically driven cohort of young people, for whom the look is as important as anything else. Poor quality photos, mismatch furniture, and dated appearance will create a barrier to entry that some students just cannot overcome. Traditional BMW (Brown carpets, Magnolia walls, White ceilings) are on the way out, and light grey and a feature wall is in.  

Ensure your furniture matches, (there are some great packages available from the Landlord Furniture Co.) and update any dated kitchens and bathrooms.  Once your house is looking great, make the beds, dress the rooms, and make sure you take quality light photos. 

Quick top tips…

…to maximise your property appeal to students:

• Replace any fluorescent tubes with spotlighting for a more modern feel

• If you can fit a double bed in – do so.  A small 4ft double is fine

• Maximise any potential parking space in front gardens

• Ensure that at the very least, you have a small sofa, and a simple breakfast bar for relaxing and eating outside of a bedroom

• If the budget allows, update any worn or mismatched furniture for a matching set from the Landlord Furniture Co.

What’s coming next?

Like every other person involved in property, the big question hanging over everyone is the impact of the Renters' Rights Bill. Student tenancies stand to see the biggest detrimental impact from the bill as it stands unless there is a change.

As I write, the House of Lords have put forward an amendment to keep fixed term tenancies for students, which would be preferable for everyone.  If this doesn’t happen, I see the following happening:

• Students will be able to leave their tenancies whenever they like, which will lead to increased voids.

• Landlords will seek to end tenancies (via a Section 4a Notice) at the end of June to negate possible voids.

• Larger agencies will need longer gaps between tenancies in order to turn them all around at the same time – most likely 1 month.

• 11 month tenancies will become the norm, meaning rents rise by around 12-13% to cover the losses.

• Some landlords, who rely on every penny of their rental income for living expenses are likely to sell up.

In summary, there is currently an oversupply of student rooms available, so existing student landlords need to ensure their houses look great, and are marketed well.  The Renters' Rights Bill is likely to result in some student landlords selling up, which may mean there are possible bargains to be had in the coming year, just make sure you buy as close to campus as possible.

Jon Champion is Managing Director of Champion Property Management, which also operates the Norwich Student Lettings brand.