The move by some student accommodation providers to make students sign up for leases that run for longer than the academic year threatens to impose an unnecessary burden on students and their families. Given the shortage of accommodation in all the major cities, students will have little choice but to agree to the 51-week leases being offered for next year. The academic year is 40 weeks on average and leases are currently for 41 weeks.
The cost to students – and in many cases their families – of the additional and unwanted 10 weeks will be in the region of €3,000 per year.
The Minister for Housing Darragh O’Brien and Minister for Further and Higher Education Simon Harris have instructed their officials to engage with the operators in question and “consider what action may follow”.
The ministers may be hoping that moral suasion will do the trick but the most likely type of action to arise out of the engagement is the legal sort. One of the larger student accommodation operators pushing for longer leases has already stated that it complies with its statutory obligations.
There are options open to the Government if it has the political appetite for them. The planning permissions for two of the purpose-built accommodation blocks at issue had conditions attached which stipulated a 40-week letting period. Others, presumably, have similar restrictions.
In addition, many of the developers will have availed themselves of tax incentives aimed specifically at the student accommodation sector and the relevant legislation refers to leases being for the academic year.
Enforcement of these conditions – or the threat of enforcement – may be sufficient to make the student accommodation providers rethink. However, the operators are well resourced and more than capable of sustaining – and potentially winning – lengthy court battles on either point. It is also safe to assume they have anticipated both issues.
The biggest stick available to Government is to end the exemption from the Residential Tenancies Act currently enjoyed by student accommodation providers if they seek leases for longer than the academic year. Under this legislation, if a tenancy exceeds six months the tenant is entitled to extend their tenancy for another five and half years. The consequences for the student accommodation providers would be serious.
The Government would no doubt be accused of acting in bad faith, which would be more than little ironic under the circumstances. The clear purpose of all the generous incentives and tax breaks given to student accommodation developers is to provide high quality, reasonably-priced accommodation for the academic year and not a day longer.