Do student properties make a good investment?

Do student properties make a good investment?

It’s that time of year again. Students across the country are upping sticks and moving away from
home into student accommodation or shared rental housing maybe for the first time. And for Buy to-Let
landlords these student rentals offer some of the best yields on the market.

Buy-to-let landlords earn an average rental return of 6.5% each year on their student properties
according to the 2018 Landlords Panel study. But if you’re a student landlord, or thinking of
becoming one there’s plenty to consider to make sure you’re getting a first class return!

Location, Location, Location!

A good location is essential to success. Not only must you choose a town or city with a growing
student population, you’ll also need to make sure the property is in one of the significant student
hotspots. Typically the most popular areas are close to the campus as well as entertainment venues
and you could trip up if you don’t understand the subtle nuances that elevate one street over
another.

Property must-haves

Given that the property is in a desirable location, the achievable rent will depend, to a large extent,
on the facilities on offer. Students like shiny kitchens and bathrooms, open plan kitchen-diners and
of course double beds for all the sleeping they get up to! If possible it’s even more attractive to have
ensuite bathrooms and outside space.

Should you use a letting agent?

In each market, there are usually a handful of letting agents that have in-depth experience of the
student market and it can pay dividends to tap into their specialist knowledge. Landlords should look for an agent qualified with either the Association of Residential Letting Agents (ARLA), the National Association of Estate Agents (NAEA) or a member of the Royal Institute of Chartered Surveyors (RICS) to make sure you get good advice. As usual though, you will need to decide whether to go for ‘find only’ or to add ‘ongoing management’ on top. There are a number of other things to consider before you can graduate as a student landlord, ranging from licensing to marketing. But if you get it right it can be very beneficial, with the average room rent per month being £566 outside of London, according to the Time Higher Education 2018.

If you’re a current or potential student landlord and want to talk through your options, contact
your adviser today.

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