For many months, the public have been in uproar over the proposed increase in student tuition fees, seeing a number of student demonstrations take place urging the government to reconsider their decision. However, in spite of the opposition against this proposal and to the dismay of parents across the UK, the Office for Fair Access (OFFA) has announced that more than a third of universities in England will be charging the maximum tuition fee of £9,000 for the next academic year, 2012-13.
Having been given the green light, the once daunting proposal has now become a worrying financial reality for many parents with new research from HSBC revealing that 10% of parents will not be contributing to the cost of their child’s university education following news that fees will treble from next year and a number of parents expecting their children to fund the increased costs themselves or on a sadder note, not attend University at all.
In addition, the survey found that around 52% of parents with youngsters under the age of 18 have not even started to save for their child’s university expenses. This is hardly surprising considering the minimum cost of living is now 5% higher than in 2010, with the Joseph Rowntree Foundation (JRF) suggesting that in order for families to live to an acceptable standard nowadays, each parent must earn at least £18,400.
Further research from HSBC indicates that 54% of parents stated that they will save more in order to fund their child’s university education while 42% said that they will cut back on luxuries. Moreover, 21% said that they would work overtime whereas 15% of parents suggested that they would search for a second job. Shockingly, a proportion of parents spoke of more extreme sacrifices they were willing to commit to such as selling the family home.
Director of student accommodation at Homeforstudents.co.uk Jonathan Moore comments,
“When the tuition fee hikes kick in next year, students and parents alike will be looking at how they can save money on accommodation costs – one of the biggest financial headaches of a university education. Parents will be reviewing every option to make their children’s university career as financially viable as possible.”
Undoubtedly, rising living costs and the sharp increase in tuition fees coupled with the average £3,807 annual cost of being accommodated in student halls has certainly got parents tearing their hair out with worry. Nevertheless it would appear that all is not lost; with 7% planning to invest in a buy to let property to rent out to other students to cover the cost of their child’s higher education, certainly a more practical solution and indeed lucrative opportunity that could be the answer to this modern day dilemma.
Alan Forsyth, Director of highly respected property investment agency, Property Secrets comments,
“I am happy to see that some parents are considering a more workable alternative that will enable them to afford a university education for their child rather than resulting to the more punishing measures highlighted in the recent findings. Opting for privately owned student housing is a sensible option where significant monthly returns can be made from renting out your buy to let property to other students. As strong believers in the student housing market, our developments in Sunderland for example can generate positive rental returns of around £400 per month based on two people sharing a room. What this equates to over the year will certainly be enough to ease the financial pressures on both parents and students.”
With record numbers still expected to attend university in the next academic year, affordable student accommodation will be in high demand and the experts at Property Secrets have ensured that they will be able to remove parental woes by offering two new purpose built student accommodation developments in the up and coming town of Sunderland, priced 25% below current valuation, offering a 1 year rental guarantee and 9-11% yields per annum net yield.
Rectory Lodge, a purpose built fully furnished modern 26 en-suite development and West lodge, a gorgeous mansion with large rooms and 4 very large living rooms, priced between £33-35,000 only a minute from The University of Sunderland and just six minutes from the impressive city centre, will pose as a worthy investment for parents looking to financial security for their child’s future.
Additionally, leading property investment agency, Property Frontiers believe that the student accommodation sector is one of the key asset classes of 2011 offering excellent monthly returns from its elegant new student accommodation development in Liverpool costing from only £48,000 with an above average 10.03% NET yield – assured in year 1.
Consisting of 100 stunning en-suite rooms, centrally located St. Andrews Place is set in a beautiful 18th century grade II listed building is adjacent to Liverpool John Moores University and close to Liverpool Lime Street station.
For more information on providing for the next generation’s educational future through investing in student accommodation in Sunderland please contact Property Secrets on +44 (0)115 985 3963, email info@propertysecrets.net or visit www.propertysecrets.net and for more information on generating exceptionally high rental income from Liverpool’s buy to let market please contact Property Frontiers today on +44 (0) 1865 202 700 or visit www.propertyfrontiers.com.