Is Student Accommodation the Right Investment for You?

PUBLISHED 31 AUG 2020   

Is Student Accommodation the Right Investment for You?

 

It is the same every year: students at local universities and colleges are left without lodging and are struggling to find a place near campus to stay. University accommodation is generally hopelessly inadequate and students seeking affordable options often opt to stay too far away from campus or in an apartment or flat that really is not worth their money. If you are a prospective property owner on the lookout for investment opportunities when it comes to property, read on below to find out why many landlords see the increasing benefit of student accommodation.

 

Why the Hesitation?

 

There are a few misconceptions surrounding student accommodation, which usually means landlords try to steer clear of this type of investment. The main myth is that younger tenants are unreliable in terms of rent or property care. While it is true that younger tenants still learning to live away from home might have some bad habits, there are plenty who make wonderful lodgers. The key here, however, is the same as with any tenant – proper and thorough vetting processes. Meeting potential tenants before signing off on anything will give you an idea of the type of person they are. Doing a background check and even getting the contact information of the tenant’s guardians responsible for their rent is a good way to ensure you do not end up with a renter who takes chances.

 

You Will Not Have to Look Hard

 

The top benefit of investing in student accommodation is that you will never have to look far to find a lodger, especially if the property is close enough to campus. Students are constantly in search of living spaces that are within walking distance of their classes, so investing in this type of property ensures that your advertised space for rent will not sit on online listings for very long at all. Be sure to get the help of rental and letting agents early, however, as students already start searching for a place to stay before the festive season.

 

Demand is Greater than Supply

 

Student accommodation is always in high demand. For you, the landlord, this means reliable tenancy. Tertiary educational institutions have difficulties with their capacity every single year, and cost-friendly and safe lodging is not easy to come by. Because students often far outnumber the available campus housing openings, your property will be highly sought after. The other benefit of this is that you have a recession-proof source of income. No matter how poorly the South African economy is currently performing, individuals who are studying and wish to live away from home will always need a place to stay. Many students are funded by their parents or guardians that are willing to pay much more for a safe and secure living environment too.

 

Your Rental Yield Increase with Each Year

 

If you decide to take in students for one year at a time (such as final-year students finishing up their studies), that means you can raise the rent with the market as you advertise annually. Families or young couples seeking a home often will not settle for a house or apartment long-term if they foresee large annual increases in rent, so students are a better way to gain better yields.

 

Students Are Less Fussy About Where They Stay

 

As long as it is safe and offers great internet connectivity, a student will not really sweat the small stuff. That means you can rent out your accommodation while it is undergoing a few upgrades, as long as this does not interfere with your tenant’s studying. A simple layout with quality facilities is enough for most students and you will find that older tenants with families are usually more picky about where they live.

 

If you would like help getting your student accommodation out onto the market as well as assistance with vetting your tenants, let us be the ones to do it for you.