Renting to students: guide to insurance, council tax and making a rent agreement

Student properties are constantly in high demand, providing an opportunity for excellent investment and consistent rental income. However, there are some key things you need to consider and address to ensure your journey as a student landlord is a smooth one. In this section, we will address the most concerns about renting to students, including getting insurance, the rules on council tax and making a rent agreement. This page will also answer frequently asked questions about renting to students.

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Find out why you should get student landlord insurance and where you can find it.

Find out which students are exempt from council tax.

Read the pros and cons of non-inclusive and inclusive rent agreements.

Find out the benefits of using a bill splitting service when you have made an inclusive rent agreement.

Should I get student landlord insurance?

Landlord insurance is not compulsory; however, if you are renting out to students, it is better to be protected in case anything goes wrong. At the end of a tenancy agreement, you may find damage that needs repairs. Although you may feel protected due to the deposit charged, the tenancy deposit taken for the student house may not cover the damages. Insurance can prevent you from having to pay out of your own pocket before your new student tenants move in.

Where can I get student landlord insurance?

When finding student landlord insurance, it is best to seek the advice of an insurance broker, such as Endsleigh or Towergate Insurance. You can also use comparison websites to find student landlord insurance quote.

Be prepared that student landlord insurance will likely to be more expensive than insurance for normal tenants. This is due to lack of income, which means they are considered a greater risk to insurers.

You can read more about finding student landlord insurance in our guide Landlord insurance: why you need it and types of cover.

What are the rules with students and council tax?

As a rule, your rental property is exempt from council tax if it’s only occupied by full-time university or college students. Students are considered to be full-time if their course covers at least 24 weeks over a whole academic year, and they have at least 21 hours of weekly study during term time (source). This includes tuition or work experience. If your tenants are part-time students, they are not exempt from paying council tax, but they may qualify for a council tax discount. The majority of postgraduate students are undertaking part-time courses so are not exempt from council tax.

You can read more about students and council tax in our guide Students and council tax: advice for landlords.

How do I prove my tenants are full-time students?

It is likely your local authority will accept students’ university number and course details; however, your tenants may need to provide a Certificate of Student Status to show your local council.

Should I offer an inclusive or non-inclusive rent agreement?

Non-inclusive rental agreements consist of a tenancy in which rent and deposit are covered directly. As a result, all bill costs and management falls on your tenants, and what they need to cover can be stipulated within the tenancy agreement that they sign. Often, this will include utility bills, internet, TV licence and any additional household costs.

Inclusive agreements, on the other hand, are inclusive of all utility bills as part of rental payments. This agreement means students are paying up-front for energy bills, gas appliances, and sometimes the property’s TV licence as part of a regular amount each month or term. An inclusive agreement is popular in a shared house as well as student accommodation, and typically, the bills will be in your name.

wooden house, pen and calculator

Many students choose inclusive rental properties as their first choice, as it means they don’t have to calculate all bills themselves and instead receive a set price to pay. However, they may end up paying more as a ‘cap’ for their utility bills than they use, which means they’re losing money.

It is important to consider all the pros and cons of each agreement before making a decision. The table below summarises the pros and cons of each agreement:

Pros and cons of non-inclusive agreements

Pros Cons
Less work for the landlord in calculating and adding bill costs to rent Unpopular choice for younger renters so can limit the number of potential tenants
Saves time in managing a number of bills across a number of properties Unpaid bills can lead to cut off services and fall on the landlord to sort out
Avoids overuse of utilities that the landlord must cover and which can impact on profits

Pros and cons of inclusive agreements

Pros Cons
May make your accommodation more desirable to tenants compared to landlords who do not offer inclusive agreements Adds to your management responsibilities
Utility bill management services can take the hassle out of managing bills for your properties You must continue to pay utility bills even if a tenant faults on rent payments, causing extra costs to you
Attract a higher number of tenants, especially millennials and students who account for a significant number of UK tenants Rises in bill costs can impact on profitability
You can ensure that bills are paid on time to prevent issues with utilities being cut off or problems that can arise when council tax is not paid A tenant may overuse utilities, causing extra, unexpected costs
Adding bills costs onto rent can make the rent seem more expensive to a prospective tenant

You can read more about choosing a rent agreement for student tenants in our guide Student Housing Bills Advice for Landlords: Choosing an Agreement.

Using a bill splitting service

Landlords are encouraged to consider outsourcing the management of bills in inclusive tenancies to a utility bill management service to take the stress and hassle out of the equation. Using a bill splitting service brings the security of having a dedicated service manage all the complexities whilst enabling you to offer the type of tenancy that your student tenants are looking for. Our website allows you to select your chosen services to include as part of the rent to your tenants. We will provide you with one monthly itemised bill to clearly manage your utilities. This means no chasing, no confusion and no complicated payment processes.

If you would rather offer a non-inclusive rent agreement, you can refer tenants to a bill-splitting service upon signing their tenancy and even receive a commission as a result. We offer a monthly commission on every property you refer, year on year. Our commissions are very generous and depend on the size of the property.

You can read more about our bills management services for landlords here.

group of students studying

Related content

Student housing bills advice for landlords

Student landlord insurance: why you need it and types of cover

Students and council tax

Renting to young professionals

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