The Landlord Exploitation Game
Landlords in Portsmouth are experiencing high volumes of international student applications, many of whom do not understand the process for applying for private accommodation, as a result of very high numbers of international students undertaking MSc courses. As a result, Local landlords are worried there may not be enough accommodation, or that the accommodation available not being suitable, with a worrying trend for couples or even families applying to live in single rooms. This is exacerbated by the appearance of foreign 'agents' trying to source properties and what may be an organised immigration racket.
What Is Going On?
Landlord and letting agent Alwin Oliver said "It seems very clear that either the university have not prepared the students for the local private housing market, or they are choosing do disregard that advice. Having dealt with multiple applicants, I am not seeing evidence that students have been pre advised, in particular with regard to referencing and guarantors". (See Alwin's summary of the situation from our January 2023 meeting here)
We have even seen applicants asking for a room for a couple in the morning, then as a single person in the afternoon, which is worrying as under the local licensing scheme and national House in Multiple Occupation regulations permit single occupancy, which puts the unwary landlord at risk of a civil penalty notice of up to £30,000
Speaking of the background, Portsmouth Landlords' chairman Martin Silman said "We have a background of students staying away from university during the pandemic and falling numbers of undergraduates, with rising numbers of purpose built student halls, which are costly and aimed at a wealthy demographic" add into the mix Portsmouth City Council, against our advice, have embarked on a pointless licensing scheme for Houses in Multiple Occupation and you have a near perfect storm" He added "it is no wonder landlords are selling up in droves".
One of our very experienced landlords, Joan Goldenberg said "I cannot believe how many enquiries I have had from Indian and Nigerian students. What I have found is none have guarantors and many are rather unreliable, they learn quickly to say what a landlord wants to hear then let them down at the last minute, or disappear from the accommodation after a month or two. I know others who have had that experience. I have never known of so many students coming in January. Maybe the Uni does not have full complement of students this year".
We are also experiencing requests for short stays, 1-2 months or leaving early into a tenancy, without regard to the signed agreement and these are highly disruptive for landlords, who traditionally operate a business model based on 10-11 months occupancy, with little chance of re-letting a room that becomes vacant mid academic year.
Alwin Oliver added "We are seeing overseas applicants registering for accommodation, paying a minimum holding payment, typically £100, then not progressing the application in order to reserve a room while shopping around for someone easier to exploit. On average, our student applicants took 90 hours to upload ID documents after application, a process that typically takes 3 minutes". He continued "these are not isolated cases, something is clearly going on".
Landlords have also noted a high volume of calls from people claiming to be acting for a friend or cousin but in reality they appear to be people setting up in their home country as "Processors" or intermediaries, doing little more than making phone calls to try to find accommodation and charging a fee for doing so. To operate as an agent in the UK a business must belong to a redress scheme, have a client account if handling client monies such as deposits and must be clear to all parties that they are acting as an agent, not try to hide the true position.
Landlords have also noticed MSc students coming to get a visa who then stay on, typically working in the care sector. While there is nothing illegal about this and in many ways it is commendable, it does seem to suggest an alternative route of entry to the UK, perfectly legally, and to secure employment in the process.
Alwin Oliver said "if that is the true position, surely it would be better to go back to the practice of 50-60 years ago and recruit people to train as associate nurses, rather than undertake an MSc in business management only to become a support worker in social housing, but that is perhaps beyond my brief".
Licensing schemes for HMOs are popular with Politicians, but often counter productive in practice, as seen in Liverpool https://www.landlordzone.co.uk/news/landlords-slam-liverpools-shockingly-slow-licence-application-process/
It appears to us that undergraduate numbers have been falling for the last 5 years, with the university believed to be seeking international applications to make up the shortfall
A typical day for a landlord or agent advertising rooms will involve multiple applications, our chair had 5 calls from Indian 'students' on Christmas Day for the one room he had advertised - none of these appeared genuine
Looking for double rooms (for a couple) or stating a friend will stay "occasionally" then refusing to take the room if this is not permitted
Many applicants are Providing only partial details, or false or misleading names (not as on passport)
Requests for same day move in, hoping to evade any guarantor process
Multiple calls to the landlord/agent requesting an urgent move in (23 calls in one day from one couple of applicants)
Providing unsuitable guarantors, including distant relatives with no income
In one case, providing a guarantor, an elderly retired couple with modest savings, on the basis of being co-religionists, but the guarantors had never actually met the person in the couple they were being asked to guarantee. To us, we had professional concerns that the relationship between applicants and guarantors was potentially exploitative and offered advice to the guarantor.
I hope these brief notes help you understand our experiences