Guidelines for Investing In Student Property in the UK
Each year, numerous students shift to the UK for furthering their higher studies. In such cases, student property can be a lucrative option and a viable asset. Research shows that about £4 billion has been invested in this sector, in the first quarter of 2015. Also, according to the latest release of the GCSE research it has been proved that with record number of universities accepting students, the necessity of quality student accommodation has also increased.
Now, if you are one of those investors who are considering this sector, here are a couple of guidelines that will help you out.
Guidelines for investors
Well, the first thing you need to ensure is the quality of accommodation, as students care about quality more than anything else. The most popular types of student accommodations are HMOs, student apartments and the student pods.
It is viable to invest in a proper HMO for attracting higher and better quality tenant. You can also generate a better rate of return if you refurbish and revamp a property for HMO. This idea is opposed to those owners who try to refurbish the property with minimum investment, but this is the only idea that helps you in the long run.
Student pods refer to those rooms within the students’ block that come with shared facilities like kitchens and bathrooms. If you are planning to invest in something like this, ensure that the pods have proper and potential for re-sale. A better option would be a student apartment which can also be sold to investors and home-owners.
Student apartments are like the regular self-contained apartments that come with a bathroom, living room and kitchen. However, they are originally in blocks with several shared services like communal areas and facilities for laundry. These apartments are also popular across the international student market.
Once you are interested in this market, as an investor you will observe the growing demands for properties as the number of students coming to the UK is increasing. It is to be noted, that both student apartments and pods can be classified under the PBSA or the Purpose Built Student Association. This Association is different from the others because it has been built considering the needs of the students in mind.
These properties have eventually led to the increase of communal zones, areas with excellent wifi and areas closer to the University campus. The drastic increase in PBSA throughout the last 20 years has been incredibly valuable for both domestic and international growth of the UK education sectors.
Speciality of these student apartments
Well there are a couple of features that students look out for in their apartments. Once you invest in a property that syncs with these features, you will end up with student property that are both lucrative and viable.
Affordability
While making their pick from the best ranges of student accommodation, students always make sure that the homes they choose are highly affordable.
Well, most of the homes in and around universities are affordable and non-extravagant. Being student accommodation, they are absolutely student friendly, both in terms of cost and convenience. One simply has to browse the web for a quick insight on the best apartments accommodation in their chosen locations.
The importance of proper location
Students readily pay a premium for their accommodation in the right area for them in the city. According to the annual report of the accommodation for students, students who attend the top 5 universities of the UK are likely to pay an additional amount of 20% every week as their rent above the average national amount for accommodation.
This further highlights the necessity of choosing the proper area in order to achieve the maximum return on investment. Just like the apartments located next to Universities, towns with more than one university attract a considerable number of students, simply because multiple institutes take many more students.
Likewise, it is also advisable to look out for local amenities. Those specific locations that come with shops, parking, and public parks are very popular among the students. On top of that, with a nearby train station, commuting turns out to be easier for them.
Catering to the preferences of students
Most of the students look out to have the cost of their utilities built into the rent, which helps them manage the cost of living. Some of the best PBSA properties also come with amenities like high-speed internet, 24-hour security for residents and communal areas.
Research your finance options
Investing in PBSA can turn out to be a major investment, generally the mainstream mortgage lenders do not lend against these kinds of properties. It is therefore necessary to use a proper broker for sourcing the best finance for you.
Student property is one of the best asset classes around today, considering the huge returns on investment. With careful research and proper research, you can invest in properties that turn out to be profitable in the long run.
FJP Investment is a team of investment specialists sourcing a wide range of investment opportunities both in the UK and overseas, including student property investments.
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