Student accommodation crisis

Increased Demand for Student Accommodations Presents Lucrative Investing Opportunity

The ideal picture of typical student accommodations has changed significantly over the past ten years. Nowadays students, particularly those in the PBSA market (Purpose Built Student Accommodation), are seeking higher quality, convenient, and private accommodations. But, there’s one big problem; universities can’t keep up with the demand. This presents a unique opportunity for investors to create lucrative passive income in key university areas.

In a recent report undertaken by the BBC, it was revealed that the increased numbers of students attending UK universities this year has led to a significant shortage of rooms in university provided accommodation. This means that many students who were expecting to have a single private room, were forced to share the space with another student, or find alternative housing.

In London for example, the number of students is growing 15x quicker than the available properties to rent. The same thing is happening in North England cities, and universities are unable to keep up with the increased demand.

Another issue for students is the cost of housing itself. As education costs continue to rise year after year, the cost of university accommodation is no exception. According to a recent Unipol Survey, in 2018-19, the national average weekly rent in university halls was £147 – a 5% increase from the year before, and a 31% increase from 2012. And the quality of university accommodation is yet another major problem, many students complaining of serious issues ranging from sewage leakages, to no heat or water, rodent infestation, and even collapsed ceilings.

With a lack of housing to keep up with demand and the continual rise of rent prices, students are seeking alternative private housing options like never before. This provides a unique opportunity for private firms and potential investors to fill the gap in this growing market.

Now is The Time to Invest

The projected demand for student accommodation is only expected to grow in the years to come and now is the ideal time to focus on key university areas when investing.

In a recent article from property reporter, Manchester and Liverpool are projected to be two of the biggest housing hot spots for 2019. On track to reach a 14.1% population increase between 2018 and 2041, Manchester is a prime investment location with a steady inflow of university students. Liverpool is another ideal location with property price growth up more than 24% over the past five years alone.

Another added benefit of student accommodation investment to consider is its countercyclical qualities. In the midst of economic downturn or depression, it’s typical to see an increase in the consumption of education, which means the demand for these types of properties remain high.

As you can see, there’s never been a better time to invest in buy to let student accommodation.

If you’re ready to explore investment opportunities, simply schedule a no-obligation call or meeting at one of our office’s in either London, Bournemouth or Sheffield, where we’ll discuss your investment criteria and tell you more about our company. Next, one of our property investment specialists will provide a shortlist of properties based on your specific needs and goals. Simply click here to get started and schedule an appointment today.