Investment in student properties and developments continues to be a profitable venture, according to the latest figures. Assetz, the investment specialist, has revealed that student developments can bring fixed yields of as much as 8% per year.
Assetz has highlighted the most popular hotspots in the UK student accommodation market, with Leicester, Glasgow, Liverpool, Southampton and York at the top of the list. Assetz is offering five year deals in these areas with 8% annual fixed rate yields.
The figures released by Assetz also highlight a 13.4% rise in the amount of buy-to-let student investors in the UK since 2007.
Stuart Law, Chief Executive Officer of Assetz, also identified the rise in the overseas student market as a reason for the improvements to the property market. He also said that there is a lack of bespoke accommodation for overseas students. Many students come to the UK to study from places such as China, India, Nigeria, Germany and France. These students now make up more than half of the total number of postgraduates studying at British institutions.
Law said: “Undergraduate student hall of residence accommodation has long been a sound buy to let investment opportunity, offering excellent yields, but the lucrative market in high quality post graduate accommodation is only just starting to materialise.”
He continued: “Many students are continuing to study after their undergraduate degree due to the current competition in the UK jobs market and overseas students are drawn to the UK for its excellent standard of university education.”
The report suggests that students appreciate the sense of independence provided by well-managed and maintained studio apartments.
Assetz offer these types student property for sale in Leicester’s Primus Place from £65,000 and at Collegelands in Glasgow from just over £77,000. Both of these investments offer assured rental yields of 8% for five years.
Offering larger than usual bedrooms and energy efficient features, Primus Place will be complete in 2015 and will have its first student intake in September of that year. The site is well placed for students, within walking distance of the University of Leicester and De Montfort University. It is also well served by transport options and is close to the popular Highcross Shopping Centre. A quarter of Leicester’s 39,000 students are postgraduates.
Similarly, Glasgow’s Collegelands development consists of over 260 purpose-built studios, and is within easy reach of all three of the city’s universities, and again within reach of transport and shopping facilities.
Glasgow has over 62,000 students, 10,000 of which are international students. Half of the student population in Glasgow are postgraduates, with only one bed available in the city for every 21 postgraduates. Assetz again provides high yields on investment in Glasgow student property.