Advantages and Disadvantages of Investing in Student Property

Investing in student property is taunted as the best investment idea you can go for if you want to reap high. This is because students will be joining each year, assuring you of returns. Even though it is a good investment option, are their cons? Yes! Student property investment has disadvantages.

In today’s article, we will cover the pros and cons of investing in student property.

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Advantages of Investing in Student Property

1. High Demand

As long as students are in session, they will look for a room to rent. This means that in no way will your property be empty. In case, one leaves another student will move in almost immediately. The reason why student property has a high demand is that universities operate all year round.

2. Returns

Once you invest in student accommodation, one thing you are sure of is constant returns. This shows you that you won’t regret putting your money into this investment idea. To get high returns, always make sure you renovate the property from time to time.

3. Stamp Duty-Free

In some countries like the United Kingdom, student property owners don’t pay stamp duty. This reduces the amount you will pay as tax before and during construction.

4. Inexpensive Land

Most universities are located outside towns and cities. And land outside towns and cities are cheap. This makes you not spend more on buying land.

5. Price Appreciation

The best thing about student accommodation is that its value rises each year. This is because the university’s location is growing, making the land appreciate. In return, it makes your property’s price rise too.

Disadvantages of Investing in Student Property

High Maintenance Cost

You need to know that student accommodations require frequent maintenance. This is not cheap. It will cost you a good amount of money as you need to repaint the building and fix broken fixtures in the rooms. Do this before another student moves in.

Lack of Financing

Currently, no lender is ready to finance student accommodation projects. This makes it hard for investors to source money.

Close Management

To ensure that your property is well kept, you need to be present always or hire someone to take care of the accommodation.

Conclusion

These are the pros and cons of investing in student property. I hope you find this information helpful as you consider investing in such assets.

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