Is Student Accommodation a Worthwhile Investment? | Huurkor
PUBLISHED 17 JAN 2020
Is Student Accommodation a Worthwhile Investment?
Whether you have been investing in the property market for a while, or if you plan on making your first purchase, you might be wondering about student accommodation. While some landlords steer clear of letting out to students, there is certainly much room for success and profits to be made. If you would like to understand the pros and cons of renting out a flat or apartment, and whether or not the venture is worth your time and money, then keep reading as we explore below.
A Few Misconceptions
The first thought that springs to mind for property owners thinking of renting out to younger tenants is that they are perhaps unreliable and destructive. As with any tenant, however, proper vetting is essential. Without getting to know prospective tenants and doing thorough background checks, you might have difficulty with anyone – not just students. For help finding a suitable renter, it is always best to utilise the services of professional estate agencies.
The main advantage of investing in this type of accommodation is that demand is always greater than supply. It’s a need that never runs dry, as most tertiary institutions like universities seem to have difficulty with capacity. 2019 saw students vastly outnumbering available on-campus housing, with many travelling far distances to get to their classes each day. Affordable, safe accommodation is more in need now than ever, and jumping into this market has the potential for significant gains.
No matter the state of the economy, there will always be students attending higher educational institutions who need housing. This means that your monthly income remains secure and steady. While some may feel as though students are not often the most punctual when it comes to rental payments, many are funded by parents who ensure they stay up to date with whatever it is they need.
Higher Rental Yields
Couples and families don’t often rent a property long-term when the annual rent increases are too high. Student accommodation, however, allows property owners to raise rent with the market when they advertise yearly. In this way, your rate of return may be higher than regular residential apartments for rent. A shortage of housing also means that learners will often pay what they need to in order to enjoy the benefits of private housing near an institution. Higher returns are what makes it attractive to investors.
Finding Tenants is Easy
Some properties sit on the market for months, either too costly, inaccessible, or large for tenants. Student accommodation does a great job of selling itself if it is situated near enough to a university or college. While it is possible to face a lack of income during the festive season when tenants leave for home, forward-thinking learners often scour the market for cost-friendly apartments during this time, so don’t fail to advertise.
Students Don’t Nit-Pick
Most students, unlike couples and families looking for a long-term home, are not too finicky or selective when it comes to where they live. Save for a few basic necessities, many enjoy a simple layout with a few amenities, and find excitement in living away from home for the first time and improving their surroundings.
Of course, there are a few ways to ensure that you get great tenants. Firstly, safety is a major concern, so keep in mind to invest in a property in which you can implement a few security features, such as barred windows or electric fencing. Then, features, such as internet connectivity, excellent cell phone signal, and weekly cleaning services also draw learners.
If you would like to kickstart your investment into this type of accommodation, then our sales and letting administrators will be happy to help you find the right property. To contact us today, feel free to fill out an online enquiry form for a branch near you.