One of the best ways to capitalise on the high demand for student property in the UK is by investing in Purpose Built Student Accommodation (PBSA). This niche asset class specifically caters to the needs of students and provides a hassle-free rental experience for investors.
The UK is known globally for its top-quality higher education institutions, attracting students from all over the world. This constant influx of students ensures a steady demand for student accommodation. With new students enrolling each year, there is a consistent need for housing that caters to their specific needs and preferences.
Additionally, areas with high graduate retention rates often have the highest demand for PBSA. These locations offer excellent opportunities for student property investment, as there is a continuous flow of students who choose to remain in the area after completing their studies. This sustained demand ensures a stable and profitable rental income for investors.
Investing in student property allows you to tap into the lucrative student housing market and benefit from the ongoing demand for high-quality accommodation. This investment opportunity provides a secure and profitable rental income, making it an attractive option for investors looking to boost their returns.
View our latest Purpose Built Student Accommodation Investments.
Investing in student property can offer significant returns, with rental rates rising at a faster pace than average. In fact, according to the Natwest 2023 Student Living Index, the average rent for students has increased by a staggering 30%. Currently, the national average monthly rent stands at £591.90.
It’s worth noting that London remains the most expensive city for students to rent in, with an average monthly cost of £840.30. This is followed by Bristol (£719.80) and Cambridge (£642.50), making up the three most expensive places for students to live. On the other side, Newcastle is home to the lowest average monthly rent of £441, then Sheffield (£473.70) and Leicester (£482.10), making up the cheapest three locations for students.
How to choose the right location for your student property
When it comes to choosing the right location for your student property investment, there are a few key factors to consider. Firstly, if you’re looking for a purpose-built student accommodation (PBSA) opportunity, it’s important to seek advice from a professional consultancy with excellent reviews like Fabrik Property Group. Our experts provide valuable insights and help you make informed decisions.
In terms of location, it’s crucial to target prime UK university towns or cities with real demand. Look for areas where the student population is growing or where there is a shortage of high-quality student accommodation. These locations are more likely to provide consistent rental demand and attract students who are willing to pay a premium for quality housing.
Another important factor to consider is the quality of the build. Invest in properties that have been specifically designed for the student market. These buildings often come with amenities and features that appeal to students, such as communal areas, study spaces, and high-speed internet. The overall quality of the build will not only attract more tenants but also ensure that your property retains its value in the long term.
Lastly, conduct thorough due diligence before making any investment. Ask to see all available information about the property, including rental demand, occupancy rates, and any potential risks or challenges. This will help you make a well-informed decision and minimise any potential pitfalls.
Considering these factors and seeking expert advice, you can choose the right location for your student property investment and maximise your rental returns.
If you’re interested in finding out more, contact Fabrik Property Group to request your copy of the 2023 UK Student Property Investment Guide.
Understanding the student housing market
Understanding the student housing market is crucial before investing in student property. Student property investment, specifically Purpose-Built Student Accommodation (PBSA), is different from traditional residential lets.
PBSA is professionally managed by a student property management team, ensuring a hassle-free experience for investors. Additionally, PBSA units are often exempt from Stamp Duty, saving investors money however, it is best to check with your solicitor before signing any contracts.
When considering investing in PBSA, it’s important to establish your exit strategy, as selling a PBSA unit is different from selling a traditional rental apartment on the open market. Furthermore, be aware that rents in the student housing market can fluctuate, and there is a risk of units going unoccupied if the development is not attractive to students or not conveniently located near campus.
One of the benefits of investing in student property is the low entry-level, making it an excellent choice for expanding your portfolio. Additionally, yields in the student housing market are typically higher than those in long-term residential lets. This means that student property investment can provide you with attractive rental returns and potentially higher capital growth.
Understanding the student housing market and its unique dynamics allows you to make informed investment decisions and maximise your returns in this lucrative asset class.
Interested in finding out more? Contact Fabrik Property Group for more information.
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