Student Property Investments
WHY INVEST IN STUDENT PROPERTY?
There are a number of reasons that investing in student property in the UK is a good place to put your money.
Investing in student property is a good idea for a multitude of different reasons, and here are just a few of them:
Student numbers on the up
In recent years the number of students in the UK has consistently been increasing and there are hundreds of thousands of students that enrol in University within the UK every year, most of which need to sort accommodation.
Overseas students increasing
Another factor to consider is that the amount of students coming from overseas has also been growing as the UK universities continue to increase in reputation. These students will of course need accommodation and often favour city centre based locations.
Significant yield returns
Student properties can offer a significant return on yield with the UK average per annum sitting at 7.8% according to Knight Frank.
TYPES OF STUDENT PROPERTY
If you are planning on investing in student property, there are two main types of property that you might consider purchasing.
Houses of Multiple Occupation (HMOs)
You’ll need to budget for a licence, if it occupies more than five people in more two or more separate properties, to invest in these types of property, however, they can be extremely profitable. They allow you to split up a house into individual accommodation with a room per person and a shared communal area, meaning you will receive rent from each tenant individually.
Purpose-Built Student Accommodation (PBSA)
These are often flat blocks or apartments built nearby the university which can be rented out to students. Universities favour these and use them as student property facilities and spend money and time marketing them, free marketing essentially!
BENEFITS AND PITFALLS OF STUDENT PROPERTY INVESTMENT
As with every kind of investment there are risks, and student property is no exception. There are both benefits and pitfalls to investing in student property, and it pays to be aware of them.
Advantages of student property investment:
- Cheap purchase price
- Strong demand
- High yields
- Less stress
- Disadvantages of student property investment
- Resale
- Ware and tear
- Licensing
- New tenants
TYPES OF STUDENT PROPERTIES TO INVEST IN
If you’re looking into investing in Student Property investments, then you have a lot of options when it comes to the types of property you can buy, in fact you’re a little spoilt for choice! Here are just a few of the types of student property available to you:
Multi-Student Lets
Multi-student lets, often referred to as house shares, involve renting out a single-family home to multiple students on individual leases.
They can be attractive for investors seeing high rental yields.
House in Multiple Occupation (HMO)
HMOs can generate income from multiple tenants, which can lead to higher yields compared to single-occupancy rentals.
Depending on the location, there can be high demand for affordable housing options, especially for students or young professionals.
Purpose Built Student Accommodation (PBSA)
Purpose-built student accommodation (PBSA) refers to housing specifally designed and constructed for students.
These properties offer a range of amenities and services beyond traditional student housing options, catering to a growing demand for modern living.
Luxury Student Accommodation
Luxury student accommodation offers a premium living experience for students, often with amenities and services beyond those found in traditional student housing.
These properties are often part of a PBSA block.
Student Studio Apartments
Student Studio apartments offer a single living space that combine sleeping, living and sometimes even cooking areas.
They can be attractive to students seeking independence and a more private living environment. Again, these are often found within a PBSA block.
Residential Buy To Lets
Student Buy-To-Lets involve purchasing a property near a university with the intention of renting it out specifically to students.
Student properties are in high demand, especially in areas surrounding the University.
