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Student Property investment in the uk

Student Property Investment, Buy to Let – A Valuable Asset

Why are student property investments gaining in popularity? (Updated)

Britain’s universities are brimming with students from all over the world. Unlike students of yesteryears, students today are more likely to have cash to spare because their parents are usually of better wealth. Though we appreciate that this is not always the case, the rise in demand of students looking for accommodation that is close to their universities and is comfortable is on the rise. Since students have higher standards of living, they don’t mind paying higher rentals.

The number of first degree students is at the highest point in the last decade, sitting at a fraction over 550,000 new students. While the university residence halls can accommodate about a third of these students, mostly first years, the rest need to find their own accommodation. That means that nearly 70% of students will be on the lookout for living spaces, which means the market is big enough for us to look at as a potential destination for our investment funds.

Thai students in Edinburgh 'BBQ' party at Holyrood park, with three guests from Liverpool (not in the picture).
Thai students in Edinburgh BBQ party at Holyrood park

There is no shortage of students who wish to rent high quality accommodation. Top universities like Cambridge, Oxford and Edinburgh are naturally the most sought after universities. Therefore student buy to let investments in these areas give good returns, other university towns like Brighton and Birmingham are also good areas to invest in. As long as students are coming to these universities, there will be a demand for student accommodation.

We are finding that luxury student housing is showing no signs of slowing down, so much so we are seeing Universities looking rather like property developers.

If you wish to be a landlord in a student buy to let property, the obvious choice is to make a property investment in a University town. If the accommodation is furnished and has double bedrooms it is likely to be in demand year after year. Students no longer like to live in shabby accommodation but have clear cut demands, they prefer accommodation that has more than one bathroom if there are two bedrooms.

For a comprehensive break-down on how to invest in student property, check out our ultimate guide to investing in student property.

With a high demand for student property, there is a shortfall and so investing in property for the purpose of accommodating students means there is an opportunity to get good returns on your investment.

Higher education is a worldwide demand and universities in the UK offer some of the best courses. Towns near universities are therefore milling with students so student housing demand is high. Student, buy to let investments in almost all of the UK’s university towns yield high rentals along with capital appreciation, with the net asset value of student property up to 7.2% for 2018 across the UK. The more renowned the university, the more likely it is to have a huge student population and therefore the student buy-to-let market has a good chance to give you good returns on investment.

FJP Investment have always found the student property market to be a good starting point for when an investor in the property market. This area of the property market is supported by the fact that the UK is a top destination for students all over the world wanting to come and get a premium education.

Overseas students demand luxury accommodation and that is the most buoyant student buy to let investment sector presently. These students prefer comfortable bedrooms and don’t like box room accommodation.

Another important aspect to consider before investment is to select areas that students like to have local, for example property near libraries or near market towns. Choose the location and the type of housing carefully if you wish to have good returns on your investment. You really can’t go wrong because the more the university population the more the demand for student accommodation and the more the returns with rents increasing by almost 3% each year.

The changing face of UK higher education has led to a drastic change in university culture, and this also had a huge impact on standard of housing for the students in United Kingdom. Nowadays, the admission criteria as well as the university tuition fees sit top of agenda for these business-minded, independent institutions, and the issues on student property investment has caught the attention of property investors like never before.

With student accommodation search engines making life easier for the student looking for accommodation, it is no surprise that the market is well oiled and functioning smoothly.

The main key here is the growing number of students, as this kind of turn only means potential investment, with the need for having quality accommodation only increasing at the same pace.

For the universities that don’t have accommodation for their existing and future students, the demand for properties/housing is even greater, and this kind of trend has led to the popularity of student property investment.

The experts in investment rental property are also keen to follow this kind of wave, with the popular university locations in UK such as Manchester and Liverpool providing firm platforms for the student rental investment properties.

It should be reminded that there’s been a shift in the students’ culture in recent times, and the profitable, fast-moving universities are moving forward away from traditional “student digs”, and instead have a deep focus on having access to student property that will encourage effective development and learning during their university years.

The (then) new student housing block looming over Tottenham Hale Station.
The (then) new student housing block looming over Tottenham Hale Station.

As universities notice this need from students, the best way to ensure that the accommodation condition within the university city walls are of a high standard, is to have a strong tie with the private sector that can possibly invest effort and time in providing the kind of accommodation that generates a better standard of living.

For the investors, the environment for this type of property investment is made more attractive when then investigating the details, because knowing that in recent times the risks tends to be the chasing shadow in property investment; student property investment manages to overcome this kind of barrier.

The traditional and rebellion views of the student house parties, as well as the widespread destruction are the typical parallels that are drawn. However, investors in student accommodation investments are generally finding that with the higher premiums paid by student come higher standards of behaviour.

Student property investment has shaken the traditional and long-held views in this kind of investment environment, as the associated risks in this kind of investment are continuously reduced, the rate of returns are increasing, which is why these are the best platforms for high return property investments.


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