Glasgow: A warning to all landlords in the UK?

Landlords around the UK have been warning for years that with growing numbers leaving the private rental sector, tenants will increasingly struggle to find somewhere to live and, it seems, that this has now come to pass.

Two stories from Glasgow this week highlight what can happen when rented accommodation becomes scarce – but landlords still get the blame for not providing enough rental homes.

The first involves more than 1,000 people wanting to view a one-bed flat for rent.

David Gibb, the operations director at Tay Letting in Glasgow, told us: “Demand in the Glasgow market this year has been incredible – we have had more than 1,000 people wanting to view a one-bed flat in the city.

“We manage thousands of properties in Glasgow, Edinburgh and Dundee and the situation is just as bad in those cities too. For example, we have a property in Edinburgh that has attracted more than 200 enquiries, particularly from students.”

‘There’s a perfect storm building up’

He added: “There’s a perfect storm building up. The tax changes with section 24 four years ago had an impact, plus every landlord in Scotland must be registered and their properties must be maintained properly.

“Demand is outstripping supply and there’s also the anti-landlord rhetoric from the Scottish government who are very much looking to bring in rent controls and this is having a knock-on effect for landlord confidence.

“Also, landlords don’t have the tax benefits they once had, and many are now feeling the squeeze.”

He says that landlords are being accused of profiteering by several political parties but ‘that is not the case’ and this leads people believing that landlords there are being greedy.

Mr Gibb also warns: “What’s happening in Glasgow, and Scotland generally, as well as in Wales, will come home to roost for landlords in England, unless the UK Government looks at the issues affecting the nations in the devolved countries and realise that landlords are a key element to stop the housing shortage in the UK.”

University could not guarantee accommodation

The second story that landlords need to appreciate is the University of Glasgow announcing that it could not guarantee accommodation for its new students this year.

That means students who are within commuting distance from campus being automatically denied accommodation. And those who live further afield, are not being guaranteed a bed.

However, the university blames a growing demand for students on a ‘significant contraction’ in the city’s private rental sector for the lack of accommodation.

They add that this shortage is down to changes in Scotland’s private rental tenancy laws and landlords being impacted by Covid restrictions who then left the sector.

And this is despite the university boosting its own accommodation bed numbers by 25%.

University has been accepting too many new students

Part of the university’s problem has been highlighted by the Students Representative Council (SRC) which says the university has been accepting too many new students for the next semester.

In a statement, the SRC said it was ‘disappointed’ by the university’s approach, particularly after Glasgow’s accommodation crisis last year and they have lobbied the university to have a moratorium on student recruitment – because it appears that over-recruitment is now creating a similar situation.

A spokesperson for the University of Glasgow said that ‘regrettably’ there has been a significant contraction in the city’s private rental market and demand for rooms is substantially ahead of expectations.

They confirmed that the university can no longer guarantee university accommodation and must prioritise accommodation for students who can’t travel from home.

It is also worth noting that there are student accommodation issues in St Andrews and Edinburgh. International students heading to the University of Strathclyde are reported to be struggling to find somewhere to live.

NUS Scotland President, Ellie Gomersall, said: “There are students across Scotland right now struggling to get accommodation for the year ahead, facing a choice between sofa-surfing or paying sky-high rents.

“We urgently need a student housing strategy, with rent controls and a student housing guarantee that ensures government, universities, and local authorities work together so every student has a safe and affordable place to live.”

‘Chronic shortage of supply caused by landlords leaving the sector’

John Blackwood, the chief executive of the Scottish Association of Landlords (SAL), told Property118.com: “As SAL has warned for over a year, a chronic shortage of supply of rented properties caused by landlords leaving the sector is driving up rents.

“Damaging rhetoric and policies from the Scottish Government are a significant factor in landlords choosing to exit the sector.

“A survey of our members earlier this year showed that there could be a cut of more than 36,000 homes available to rent in Scotland as over a third of private landlords look to reduce the number of properties they let out, leading to more housing shortages.”

He added: “For students, in particular, this is also partially attributable to an unintended consequence of the Private Residential Tenancy (PRT) introduced in 2017 that reduced the number of homes available to students as landlords were no longer able to offer fixed-term leases which matched term times.

“The Scottish Government must put in place a real strategy for increasing supply and investment across the housing sector, including in the private rented sector.”

Put the skids under the student accommodation market

Worryingly, it is the Private Residential Tenancy rules that look set to be replicated in England with the Renter’s Reform Bill – and which could put the skids under the student accommodation market.

In Scotland, the new law replaced assured and short assured tenancy agreements, so they are now open-ended – with landlords in England facing the prospect of periodic tenancies replacing assured and shorthold tenancies.

The other interesting issue is that Glasgow council announced last year that it would prevent any more student flats from being built in some areas in the city due to an over-concentration of student accommodation.

But the shortage of student accommodation isn’t just happening in Scotland – the University of the West of England in Bristol has also revealed that its halls of residence were oversubscribed shortly after applications were opened.

This means we will be seeing the same stories in September and October of students being housed in towns and cities many miles from their university campus as they struggle to find somewhere to live.

Except, that for students in 2022 they will find that search even harder.

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