Is it worth looking at UK student accommodation?

[Nicholas Wallwork]

Before we even begin to discuss student accommodation in the UK we would like to open up by confirming that university applications have increased by 2.7% this year in the UK and there will be in excess of 550,000 students getting themselves ready for an autumn start. The fact is that while the UK economy [...]

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[John Ma]

I think student accommodation is a great area to invest. With students looking for a place to stay every year it should guarantee tenancy. However it can be quite annoying to have people move in and out every single year.

 

[Daril]

If there is 2.7% increase this means in the next 5 years this market will definitely grow or at least stay stable.

 

[UmAlam]

I am too in favor of investing in the student accommodation suites because this industry itself a lot more potential to expand much more as it is in current era. But one thing is to make sure that there are a handy number of areas all in UK where students are facing housing shortages particularly the luxurious one and all the investors are not able to purchase the student suites where there is a huge difference among the properties in different areas. But still as the rents and the property prices are hiked during the last decade it is an obvious research that the rental income and the property prices would take a hike again and the investors would be able to gain huge returns over their capital invested.

 

[UmAlam]

For a literal basis i am going to share an article here which i have written on the investing in student accommodation
articlesnatch Dot com/Article/Investing-in-Student-Housing-----A-Case-Study/6038295#.UjfqfqzxdDw

 

[Ed_P]

Having been a student myself I would say that getting onto the student property is very worthwhile. If you are able to register yourself with a local university and you are approved, they will send students your way, especially if you are in a good location, so you are guaranteed a steady income.

It is a safe way to ensure a return on investment as students will usually have maintenance loans to live on if they are from the UK and so missing rent payments is not common. Those who are not from the UK have to sign a declaration and go through checks with their uni to ensure they are able to afford studying abroad.

Even with the rise in tuition fees, universities are having to turn students away each year as they have reached capacity so there is no risk of this market dying down any time soon.

 

[totallyproperty]

Hi Ed_P

First of all welcome to the forum.

I think the student property market has changed dramatically over the years and can now be seen as a steady long term investment opportunity. If you pick the right place and are able to rent out your properties to their maximum then you should make a decent return.

Regards,


Mark

 

[Bilbo80]

It's definitely something I'd be interested in looking at now, whereas a few years ago I wouldn't have.

 

[eddyarchy]

It is a great investment, however, myself being a student, they can totally trash the place with the uni parties!

 

[Ged Ward]

Student accommodation generally gives a higher yield and not m,uch growth and can be hard to sell on. Also they rooms may not get looked after as much so may mean a redecoration each year. Also they tend to be bought by big UK funds as the yield is so good its good for their balance profits each year. You are better in residential for growth.

Ged

 

[ohrsome]

A client of mine has 150(ish) student properties in Middlesbrough. They are traditional terraced properties which he has rented out successfully year after year. Recently purpose built blocks of flats have been built and the demand for his properties has plumeted to the point where he now has vacant stock and is considering alternatives.

The new purpose built flats rent out at a much higher rate but foreign students are being sponsored by governments to study in the UK with their expenses paid.

The modern purpose built flats seem to be the way to go.

 

[Barny]

A client of mine has 150(ish) student properties in Middlesbrough. They are traditional terraced properties which he has rented out successfully year after year. Recently purpose built blocks of flats have been built and the demand for his properties has plumeted to the point where he now has vacant stock and is considering alternatives.

The new purpose built flats rent out at a much higher rate but foreign students are being sponsored by governments to study in the UK with their expenses paid.

The modern purpose built flats seem to be the way to go.

Since looking for my next BTL venture, I've liked what I've heard about the areas around Yorkshire, Liverpool, Manchester and Wigan in that there are many new purpose built blocks aimed at either students or working professionals.

I've only focused on the ones that come with a guaranteed 2/3 or 5 year tenancy contract because, similar to your friends issue, I wouldn't want to take the risk of having a tenant in for a year and then not have another for a number of months or to seriously reduce the rent to attract someone.