Report shows student accommodation is booming

Landlords looking to expand their portfolios may wish to invest in properties in popular student areas, as this segment of the market is performing particularly well.

Landlords looking to expand their portfolios may wish to invest in properties in popular student areas, as this segment of the market is performing particularly well.

That is according to a report from Frank Knight, which stated that regional student accommodation delivered total returns - including capital value and income - of 14.65 per cent in the year to December 2010, while in London this figure was 8.41 per cent.

Average rents in regional cities climbed 4.1 per cent over the period, outperforming the capital which saw a fall of 3.6 per cent.

James Pullan, Knight Franks head of student property, stated that the record number of applications for university entry this year will put pressure on the housing infrastructure of many cities.

"Once again students will find there is an undersupply of student accommodation to meet their needs. The student accommodation sector is now recognised as forming a critical component of a balanced investment portfolio," he added.

Property analyst at FindaProperty.com Samantha Baden said that the laws of supply and demand mean that rents are unlikely to fall in many areas for the foreseeable future.

Posted by Royston Hunter, Simple Landlords Insurance

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