Student Accommodation Investment for Sale
Student property investments have been one of the UK’s strongest performing asset classes, outperforming most other investment opportunities in the commercial property sector.
One of the key driving factors behind the high returns is simply due to the nature of student accommodation.
Unlike regular residential dwellings where you may have several rooms and separate living area, kitchen, dining room, etc, all of which take up valuable space, with student properties it is far easier to fill a development with a higher number of beds within a dorm-like structure.
The result is a high number of students (paying residents) sharing a single kitchen and communal area. These additional profits are shared among all investors meaning higher yields all around.
With the UK becoming an increasingly popular location for overseas students, combined with a lack of purpose-built accommodation to meet this increasing demand, student property has proven to be an extremely lucrative investment.
Student accommodation can often be an off-plan investment, meaning 'you' as an investor will purchase at a much lower price than the actual value of the property upon completion.
From this point you are presented with two options, sell for a quick profit, or benefit from the regular rental income and also the capital appreciation as the value of the property increases further year on year, this is the popular route for savvy investors who have superior industry experience.
Discover more about the market research, benefits and risks of student accommodation investment in our in-depth guide, “Is Student Accommodation a Good Investment?”
Best Place to Invest in Student Accommodation
Like any property investment, there are two elements that are important to consider when selecting locations, firstly from the point-of-view of residents and secondly, perhaps more importantly, the investors' angle, both of which combine together to make the perfect location for student property.
It is vital that the location is an area which has a high demand for student property, ideally somewhere which struggles to match the yearly demand for purpose-built accommodation, however, for investors, it is also important that the area offers high rental yields. These high rental yields depend on two further factors, low entry prices and decent rental rates for the landlord/investor.
With all these factors in mind, it is easy to identify the best locations with north-western cities coming out on top, with Liverpool leading the way.
Whilst cities like Manchester have become somewhat saturated, Liverpool still has room for plenty of growth as we continue to see high demands for purpose-built accommodation due to the huge number of students in the city.
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March 21, 2019
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