Property investments have long been a popular choice for both first time and established investors alike. If you are looking for a property investment target, there are some clear indications that student properties are currently a solid choice.
Market Growth
The student housing market has proven to be strong and resilient over the last couple of years, and this trend has continued throughout 2018. Student property is now one of the most profitable asset classes there is, reliably paying out excellent returns to investors who have been let down by other sectors of property investment. Overall investment in student properties is expected to end the year £5.3bn higher than last year, a strong indicator of the market’s strength.
Foreign Investors
Another indicator of the health and strength of the market is the rise in foreign investment, which now accounts for 65% of the capital being invested. This figure is noticeably higher than in previous years, with particular interest coming from investment groups based in Asia. While there is some uncertainty about the ramifications that Brexit will have on foreign student numbers, only 6% of foreign students in the UK are EU nationals. It is therefore likely that, in the short and long term, there will still be stable demand from other regions, in particular Asia.
Overseas Students
In spite of the uncertainty caused by the Brexit vote, the percentage of foreign national students studying in the UK is expected to remain steady. The UK higher education system has an excellent global reputation, meaning that, regardless of Brexit, there are still many students from a number of different countries who want to come to the UK to study. In fact, since the Brexit vote, there has been a rise in the number of students applying to study in the UK from outside the EU.
Buy-to-Let Returns
University towns are excellent targets for buy-to-let investments, but not all university towns are created equal in this regard. You should make sure to investigate the specific market that you are considering investing in to see how well these kinds of investments perform. But with more and more students opting for private accommodation over halls of residence and house-share schemes through the university, there are some fantastic opportunities to be had investing in buy-to-let properties in and around university towns.
Increasing Quality of Properties
The nature of student accommodation has changed a lot in recent years. There was a time when student accommodation was all about affordability, and often not a whole lot else. Today, however, the average student is a lot more discerning. Modern amenities and utilities are expected in many cases. If you’re going to invest in student properties, you need to know what the competition is like.
Take a city like Nottingham as an example. These private options offered by Collegiate are a typical example of the more upmarket kind of student accommodation Nottingham has to offer. If you are investing in a more modern student city such as this one, you will need to make sure that you are able to compete with the existing offerings. The increasing quality of student accommodation through companies such as Collegiate means that the modern student is often willing to pay quite a lot more than they would have in the past. This is great news for investors.
Anyone looking for a reliable property investment opportunity should consider whether student properties might be the ideal investment target. The market certainly seems to be booming right now and is proving to be resilient to the uncertainty generated by Brexit.
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