There are several reasons why a student property investment can produce high yield returns – one being the number of students enrolling for higher education in the UK. The research we sighted indicates that:
- a) In 2015, the student rental market grew above inflation, with Liverpool, Manchester and Sheffield growing above mean.
- b) Purpose built student accommodation have recently outperformed the traditional property sector in terms of total returns.
- c) Higher capital growth on a comparable basis is another attractive feature.
- d) The Knight Frank report is available upon request.
According to one student accommodation specialist (the full report is available on request):
“The student buy-to-let market is now well established and has the ability to deliver a robust long-term, low-risk income stream. High quality developments in prime locations, preferably close to a university or city/town centre will help ensure the longevity of investor returns.”
“Student accommodation developments are designed and built specifically for the needs of students, while astute property investors are able to benefit from a high yielding and effortless income.”
“These privately-owned university apartments provide a safe and secure living environment, with space conducive to both study and socialising. This includes a range of appealing onsite facilities, such as gyms, games rooms, cinemas and study centres, as well as high speed Wi-Fi and Satellite TV.”
“Universities have for a long time failed to provide enough halls of residence to accommodate all their students, and have consequently had to give priority to first year students.”
“Thus, despite 85% of second year students preferring Purpose Built Student Accommodation, the vast majority of students have to settle for less desirable residential housing – often located on the outskirts of the city.”
“Such accommodation is often sub-standard and located in run-down areas far from university campuses. There are also additional hassles, such as having to find housemates, pay bills, and furnish the property. Landlords are often difficult to contact should there be any issues, such as a leaking tap, lost key or broken boiler, and thus standards regularly drop rapidly.”
“On top of this, the shortage of accommodation in the UK as a whole – with a shortfall of a million homes expected by 2022 – has resulted in strict limitations on students living in such properties.”