The need for student housing in UK university cities has driven a significant increase in the last ten years in the student property market, attracting investors from all over the world. We're here to help with the solution to the query "Is student property a good investment?" but you may still have it.
Student housing is more important than ever to a real estate investor’s holding. While there are numerous options, in order to make sure a student property turns into a wise investment, investors need be aware of disadvantages and make sure to look for properties with greater yields and consistent occupancy levels.
Investing in student real estate can provide investors with several benefits. However, there are several drawbacks that you should be aware of before starting this real estate investing adventure.
The benefits and drawbacks of investing in a Student Accommodation Bath are all discussed below.
What Advantages Come with Purchasing Student Real Estate?
High level of demand
With student enrollment at all-time highs, it makes sense to capitalise on this expanding industry in order to supply the significant demand for reasonably priced dorms in handy locations. Students will always need housing, regardless of the status of the economy (particularly considering the severe lack of student housing in many cities), so you can be sure you have a steady market.
High rental yields
It makes sense that student housing would be a profitable sector to investigate for real estate investment, given its outstanding rental yields. More specifically, one of the most alluring features of investing in student housing is that it typically yields NET returns of eight to ten percent, which enables investors to profit from the increased rental income in addition to covering their mortgage payments.
No gap periods for rentals
The reduction or even elimination of renting void periods is one advantage of investing in student housing, as was already highlighted. Annual contracts are frequently in place due to the robust and steady demand for student accommodation. Consequently, before your present tenants' lease expires, you'll be able to arrange for the next group of renters. When students enrol for three- or four-year studies with almost no gap periods, these tenancies can occasionally be even longer.
Extended leases
It is common for students to consent to a tenancy that lasts between six and twelve months, with the possibility of an extension at the conclusion of the agreement. However, there are instances where students consent to one-year or even longer renting terms. Finding new tenants will therefore need less time, money, and effort on your part.
No stamp duty
The Finance Act of 2016 guarantees that investors won't have to pay Stamp Duty on homes bought for less than £125,000, albeit there are several exceptions. Investors will be able to take advantage of this financial savings, as many entry-level student housing options are priced below this amount.
Dependable renters
Accommodation-seeking students are usually financially supported by their student loans or by guarantors. This provides investors and landlords with the assurance that, even in the event that a renter occasionally falls late on their rent, they won't be harassing them for it.
The Downside
Conversely, the following are some drawbacks to take into account:
· Wear and tear: A larger degree of wear and tear may be expected than in a single-family rental.
· Direct management: Student properties need to be managed carefully and closely.
· Regulatory concerns: If your home is classified as a house in multiple occupancy (HMO), be prepared for additional setup, planning consent, and licencing concerns.
· Seasonal occupancy: During the summer, tenants either pay no rent at all or a discounted rate, and properties are frequently empty from September to June.
Student Castle
One of the most well-liked dorms in Bath City Centre is Student Castle, which offers students an absolutely amazing experience. There are many chic studios and twins available close to the River Avon. Bath College and the University of Bath are both conveniently close to Student Castle Bath. Additionally, student housing is conveniently close to the Bath Abbey bus stop and the Bath Bus Station, which is located near Avon Street.
Features
This well-built lodging, which located in the centre of this lovely spa city, offers a variety of single and twin studios that are fully equipped. Additionally, the resort provides free 24-hour security, a TV room, ultra-fast wi-fi, and a fully equipped gym.
You must be logged in to post a comment.