Property-sector business sales broker Adam Walker claims in an article on The Negotiator website that the student lettings market is facing significant disruption following changes introduced by the Renters’ Rights Act.

Walker states many student tenancy agreements began in September 2025 and were intended to run for 12 months. However, the new legislation enabled students to end those agreements early, changing the position for landlords and letting agents after the contracts had already been signed.

Summer void periods

One of the immediate concerns is the prospect of student properties remaining empty during the summer. Landlords affected by an extended void period could lose three months of rental income, potentially removing the profit they expected to make during the year.

Letting agents may also be affected. Where no rent is collected, agents may receive no associated fees for the same period. Walker argues that, because few letting agencies operate with profit margins above 20%, the loss of three months’ income could eliminate their annual profit.

The disruption may be less pronounced in future years as the market adapts. Student tenancy agreements could begin in June rather than September, reducing the likelihood of an unplanned summer void.

Another possible response is an increase in rents. Walker suggests that rents could rise by 25% to account for an expected three-month period without rental income during the summer.

Potential changes to the market

The legislation may also influence landlords’ longer-term decisions. Some student landlords could sell their properties or move into other parts of the rental market by letting to professional tenants instead.

There could also be further growth in purpose-built student accommodation, which is exempt from the new rules. However, Walker notes that this type of accommodation is generally more expensive than traditional student housing. Any resulting shift towards purpose-built accommodation or higher rents could therefore increase costs for students.

The changes may affect the value of student letting businesses in the short term. Walker reports that prices for these businesses have fallen significantly, reflecting the current uncertainty and the financial pressures facing the sector.

However, he expects letting agents to develop ways of mitigating the effects of the legislation. His view is that demand for student letting businesses, and the prices achieved when they are sold, could recover once the market has adjusted.

For owners considering the future of a student lettings business, Walker’s advice is to retain the business for another year while the consequences of the legislation become clearer.