‘A’ for effort: B2L investors commit whole heartedly to UK Student Housing market

In spite of the gloomy economic climate, the student accommodation sector has remained extraordinarily buoyant, kept afloat by the imbalance of supply and demand of student housing felt in many university cities across the UK.

With the assurance of a guaranteed long term income and appealing yields of between 5.25% and 7.00% depending on location and the leasing agreement, investors have been snapping up purpose built student accommodation residences left right and centre, with an estimated £347,675,000 committed to the sector in the UK since the beginning of 2011 according to the latest report from CB Richard Ellis 2011.

Indeed, student numbers have been rising year-on-year over the last five years, increasing by 4% last year alone according to the CBRE report with the growth in university students putting considerable pressure on the existing student housing stock across the country. The report highlights that there are around five full-time students for every bed-space available in Brighton and Hove University for example followed by a mere seven spaces in Dundee and nine in Glasgow.

Concerns over the impact on demand due to the forthcoming £9,000 a year student tuition fees have been allayed as students will not need to pay any of charges up-front, a key factor in upholding existing levels of housing demand and ensuring upward pressure on rents. In fact, it has been suggested that the increased fees will place greater importance on value for money and improved quality with student accommodation playing a significant part in the overall university experience.

Jennet Siebrits, head of Residential Research, CB Richard Ellis comments,

“Accommodation will play an even more important role in a university’s overall offer as students’ expectations increase with their budgets which will see students demand high quality accommodation, a good service led approach from operators and ideally, all inclusive rent. Private developers will be relied upon to plug this gap, given that the universities will have very little capital to do so themselves. This should encourage more opportunities for developers to work closely with the institutions going forward, which will also prove helpful in the planning process.”

It is expected that demand for student housing will continue to remain resilient overall with the sector predicted to outperform most other property sectors by some margin and with investors and developers continuing to be attracted to the traditional university cities, predominantly those in the Russell Group which represents the 20 leading universities in the UK, there are plenty of investment opportunities to be had.

Alan Forsyth, Director of highly respected property investment agency, Property Secrets comments,

“Students have realised the appeals of modern, purpose built accommodation available from the private sector and this in turn is pushing up demand. Consequently, buy to let investors will continue to look towards the private student housing market as a way of ensuring guaranteed returns as well as a diversification of their real estate portfolios – our student housing developments located close to the Russell Group University of Manchester will enable investors to do just that.”

With a booming market and high rental yields to be enjoyed, buy-to-let property experts, Property Secrets, are offering the chance to invest in two hands-off, hassle free opportunities in Manchester.

Montgomery House, a student accommodation block, ideally situated on the edge of Alexandra Park close to the city centre and Manchester University consists of 240 individual bedrooms as well as bathrooms, kitchens and living areas priced at just £24,000 for a student pod with a rental guarantee for the first year and a gross rental yield of 6-10%.

Additionally, consisting of one, two and three bed duplex apartments totalling to 100 apartments with each apartment affording a large open plan living area, modern fitted kitchen, modern bathroom fittings and off street parking, Empress Mill in Manchester costing from just £65,000 has a long leasehold basis for a period of 125 years and has an estimated rental income potential of £500pcm with a yield of around 8%

For more information on these fantastic opportunities to invest in a secure and lucrative development destined to make significant returns please contact Property Secrets on +44 (0)115 985 3963, email info@propertysecrets.net or visit www.propertysecrets.net.