Property investors pointed towards student buy to let sector

Tuesday 26th January 2010

While average buy-to-let rents across the UK may have fallen or remained stable over the past year, one sector that appears to be holding strong is the student buy-to-let sector, according to the latest data from property investment specialist Assetz.

UCAS reported that student applications for 2009-2010 were 2.4 million (up 34% from 1996-1997). However in the face of such demand there remains a huge national shortage of student accommodation.

As a result of this lack of supply, rents for student property have increased 19% over the past five years and gross yields for investors are typically between 7-10% depending upon the location and property type.

The property group has outlined the benefits of investing in the student property sector, saying that typical rents are significantly higher for student properties than a comparable buy to let property in the same city.

Also, with the number of students increasing and sustaining demand and rental income increasing by 5% each year for the last six years in the student accommodation property sector it looks to b one of the most resilient areas to invest in during tough economic times.

Stuart Law, Chief Executive of Assetz, commented: “Student property can be a low risk, high yielding and hands-off investment, making it ideal for those who are looking for a safe home for their hard-earned cash.

“The surge in demand for university places and shortage of supply of properties is generating superb opportunities for professional property investors who can purchase apartments in private university halls of residence, or invest in traditional shared student houses.

“While traditional buy-to-let landlords have seen stable or declining rents, this is one sector of the property market which is set to continue to benefit from the economic downturn.”