2025-26 Student rental season: Review and Adjustments

7th October 2025

One of the primary appeals of the student rental market is its cyclical nature. Among other annual events, there is the opportunity each season to review market conditions ahead of the next round of advertising. This is an exciting time of year, but this review point is also essential to ensure the success of the next 12 months. Ahead of next season our review is even more vital than usual given the unique nature of the 2024-25 season and some of the surprises it brought, as well as looming legislative changes.

Importantly, whilst the 2024-25 season started strongly, in line with our estimations, this quickly turned, and by the early weeks of 2025 it was evident that the market was in poorer shape than hoped. This continued and as the season is now ending, overall data and feedback is a far cry from what was hoped. As it stands the total number of let HMOs in the City has significantly reduced compared to last year, including many HMOs still unlet for this starting academic year. Whilst we still await final data from other external sources to confirm this, we also expect the average rental price of HMOs to have reduced this year, for the first time in at least half a decade.

Vitally the fantastic work of Coapt’s lettings team has ensured that once again we are the market leaders over this past year, and by a growing margin. This year our success has been amplified by our ability to assess the market, communicate this with our clients, and pivot strategy as required. Whilst other agencies and suppliers have seen a significant reduction in houses let, and rents achieved, Coapt have been able to overcome the market conditions in most cases.

The market has constricted

For Landlords whose properties were let agreed in the early part of this past season, or for an increased rent, it may be a surprise to hear that the market has fallen so flat as the year progressed. Ultimately no single factor has caused this, but some of the key driving forces have been:

• A reduction in demand for HMOs due to:
• Lower student numbers coming to the UK from abroad, reducing the first-year market
• A reduction in domestic university applications, reducing the first-year market
• Increase in the availability of Purpose-Built-Serviced-Accommodation (PBSA)
• PBSA offering rooms to second- and third-year students for the first time, to account for the reduced first-year market
• Reduced budgets of HMO tenants
• Domestic students have reported decreased budgets due to economic pressures, especially when parents or guardians cover their rental payments
• A change in the origin country of many overseas students. Recent StuRents reports have detailed a reduction in the Chinese market, who have also been shown to have the highest budgets, but an increase in tenants from other origin countries shown to have lower budgets
• Later Market
• The University of Sussex has fallen in national rankings and therefor appeal. Data is expected soon to show a reduced number of first choice applications, requiring the institution to fill courses more through clearing, which comes later in the season.
• Snowballing has been caused by the market slowing in the new year. As some properties reduced rent to speed up rental, there is reduced incentive for students to source accommodation quickly thanks to decreased competition, and lower rates if waiting.
• Change in priorities
• The order in which our available properties let this year has shifted away from location prioritisation, to a stronger statistical trend of cheaper accommodation letting first.
• Reduced group sizes
• The average size of a student rental group has reduced consistently over the past few years.
• Once expected cause is decreased social group sizes amongst young people
• PBSA now also offer fully isolated studios, whereas previously Uni halls held some shared facilities, such as the kitchen. Students are now less likely to form housing groups to move to HMOs via with their neighbours in PBSA.
• This effect is most notably felt for properties seeking 6 or more sharers in a group.
• In contrast the average size of HMOs has increased, with local landlords preferring to expand and build upon current assets rather than to buy a new site.

Market conditions will have been unexpected for students also. At the start of the season many would have anticipated the usual need to source housing early to be sure of not missing out on better quality accommodation. This lead to an artificially strong market at the start of the season, and some rentals achieved at figures which will now appear as statistically above their true value.

Renters Rights Bill (RRB)

Coapt have been monitoring progress of the upcoming rental market reform since the initial white paper from the then conservative government. As we have written about in the past, and spoken about with clients, much of the bill is navigable, especially in the student market.

There has been further recent conversation that Ground 4A will be included in the bill. This is a way in which student properties can still be repossessed once a year, as a way to end the tenancy under the new legislation in which fixed terms will not exist. In short, it will still be possible to have a firm end date for student tenancies. The issue we have been planning for though is that of preventing early exits, leading to prolonged voids. Presently it seems likely that a student wishing to exit a tenancy will have the flexibility to do so, without repercussion or financial penalty, at any stage in the year.

Once again student Landlords will be less effected than other forms of property, as overall the percentage of students looking to leave HMOs part way through an academic year will be low. However we do anticipate large numbers of students seeking to leave HMOs at the end of University exams, much early in the summer than the current regular lettings cycle, as many students already vacate HMOs at that time of year. Though tenants are presently bound to still pay rent until August/September, they will now have the option to leave sooner and save on rental payments for the period they are not occupying the property.

There is presently mixed information about when the bill will pass, and more so when it’s changes will come into effect, with the added promise that there will be grace periods for tenancies already in effect. It is our present estimation that fixed term tenancies that started this summer, will still run their full course. It is most likely the following 2026-27 tenancies in which students will have the ability to quit at any stage.

Coapt have though been in conversation with a vast number of other accommodation providers including the leading of meetings with other agents, and conversations held with large private Landlords with vast portfolios. In total, in addition to Coapt’s own 15% share of the Brighton HMO market, we have had contact with the providers of circa 68% of all HMOs in the city. We have reached agreement with these various supplies to collectively work to combat and mitigate the risk of having summer long void periods if tenancies end early. We aim to resolve this issue by starting tenancies earlier. Where tenancies begin in July, as a new default, a full 12 month let will still be the most likely outcome in most situations. This model works solely because of Coapt’s engagement with other suppliers, to collectively offer earlier start dates, meaning the later starts usually appealing to tenants will be in much lower supply, and only an early start is available if wanting to secure good and affordable housing. In order to work towards this, you may note that our recommended tenancy dates for your 2026-27 will be shortened. This protects you against any potential timing of the RRB, and starts the work towards bringing the start date of tenancies earlier in the year.

Finally, the RRB is likely to further reduce the international student market, due to impositions planned on requesting rent paid in advanced in lieu of a UK based guarantor. We presently expect reduced appeal of international students for UK Landlords if an alternative such as company guarantors cannot be agreed to be sure of income security.

Quality of accommodation

Finally it is an important time to be reminded of the importance of supplying quality accommodation. In a market which has become more competitive it is vital to control the controllables. As referenced, Coapt’s data has indicated a market trend moving away from location prioritisation, with a growing importance of pricing affordably, and the quality of the home offered. Re-investment in your property is vital to ensure an early let, and avoid being caught up in the later market, which may well once again involve reducing rates as demand diminishes later in the season. We should not forget that the UK as a whole is also suffering from a shortage of housing. By improving your asset you are ensuring the flexibility to pivot with the market, and retain options to be viable to a range of tenant types, or for sale. To achieve the best results from this, it is best to assess and make decisions early about works to be carried out. This work can then be described on the property listing and factored into pricing strategy.

Christmas offers the opportunity to carry out works and improvements for viewers in the new year, rather than the promise of summer refurbishments. Coapt have found these scheduled upgrades for before the tenancy starts to have a reduced impact; Christmas works, carried out whilst tenants are away for holidays, mean potential tenants can see property improvements and newly upgraded décor rather than hanging onto the promise of them.

For more information or advise on the best way in which to invest in your asset, do speak to your Coapt Property Manager.

2026-27 Season Summary

To reflect the market we have seen in 2024-25, and based on our early analysis of how 26-27 will shape up, heading into the marketing season we have some clear recommendations and plans to protect our clients and their assets, these are:

• Shortened tenancy lengths, as to work towards an earlier student turnaround period, with future start dates being earlier, we must start to shift current end dates, as to mitigate effects of the RRB.
• Conservative rental figures to reflect reduced demand. For properties let early in this past season, before market deterioration, this may include rental reductions compared to the current lets agreed, where appropriate.
• Adaptability will be vital, making swift and early decision to amend pricing strategy. Holding out for the highest possible rent will likely result in needing to drop more significantly than if pitching at a more obtainable and middle-line sum from the start and securing an earlier let.
• Review of property condition and areas requiring investment and upgrading is vital. This should take place as soon as possible so that improvement works can be factored into pricing strategy and included in marketing information.

We’re confident that Coapt will continue to deliver the results you expect. To discuss these insights further and to ensure you’re fully prepared for the 2025–2026 student renting season, please schedule a meeting with your property manager within the next two weeks, ahead of our student stock launch in November.