Number 1 UK Property Investment
Purpose built student accommodation investment has become a significant growth area for property investors from both UK and overseas.
The modern generation of students are used to sophisticated living standards and unlike their parents before them are less inclined to be willing to live in HMO (Homes of Multiple Occupancy) which are often bedsits which lack modern facilities. Security, proximity to university and culture issues also factor highly especially for the end user student who may well be from a distant continent as foreign students make up a fair percentage of occupants for this sector.
These new developments provide everything that a young student leaving home for the first time would wish for and in addition to modern, well-designed, high specification studios and flats often referred to as cluster units, in-house facilities include communal areas, reading rooms, gyms, cinemas and the provision of hi-speed broadband and Wi-Fi throughout.
Security is also part of the package with 24-hour CCTV providing comfort to parents as well as the students! There is a serious under supply of stock for this type of demand in most university cities.
Why Invest in this Asset Class?
The yields are very attractive typically 8% to 10% per annum net, payments are guaranteed by the developers who employ leading established specialist management companies. Terms can be fixed for 2 to 10 years although as rents have increased annually for many years, 2 to 3 year fixed is advisable as longer may restrict investment growth.
Investment entry levels are surprisingly low compared to a more conventional property investment. We have investment opportunities available from as little as £49,950 with a net yield of 9% net yield making this a genuine “hands off” property investment.
Opportunities exist in London & Manchester although in this sector investments are more rewarding in the likes of Liverpool, Nottingham, Sheffield for example. Leading management company Urban Student Life boast almost full occupancy on managed projects.
The change of requirement for students means this investment opportunity is sustainable as the under supply to meet required demand is immense with cities like Liverpool and Sheffield in need of thousands of units.
RBH are selling student accommodation units to individuals as well as assisting institutions and HNWI clients with bulk wholesale purchases. They can arrange for SPV company set up making purchase and exit strategy tax efficient.