If you are looking to invest in a high return asset in your portfolio than investment in student property UK is an excellent option. Student accommodation has outperformed every other type of real estate including offices and industrial areas for past few years. And there seems no stopping to this rise in profits as international investors have shown keen interest in this particular sector.
Growing Education Sector:
While other services sector have seen little or no growth for the past few years, education exports have increased manifold in the previous decade. The number of students have increased from 1.8 million to 2.3 million over the past decade. Institutions in UK are also a magnet for foreign students. Universities in UK provide a much sought after competitive environment for the international students. The number of students making their way to UK for higher education has grown exponentially. Some of the renowned universities in UK have 30 % enrollment of students that come from abroad.
Investment Opportunities and High Returns:
Considering the rise in both domestic and international students it is easy to understand the student accommodation investment scenario. According to the data released by Knight Frank, Total returns from student accommodation outperformed other property investment in the year to September 2013, reaching 7.8%, with Industrial and Office at around 7.5%, all property at 5.2% and retail at just over 3%, the report states. The student accommodation investment UK sector is still deficient in funding.
Governments Helping Hand:
Friendly policies by Government towards education, international students, universities and the due visa process has further increased the growth potential in the student accommodation investment UK. Recent decisions by government to ease the visa process and allowing universities to admit more students than permitted have indicated that they want this particular sector to grow. This gives investors a go ahead signal for long term commitment to this sector.
Deciding to Invest in the student property market may be easy but you will have to keep a lot of factors in mind for a successful investment. Locations and the type of property are one of the most important decisions. Talking with local real estate agents and getting an idea of the local economy are essential before you reach any final conclusion.
Hotel style suits are fairly popular with international post graduate students. The best options is to invest is in purpose built student accommodation because the company will find the tenants and manage the building.
Londons rental growth was flat this year, at 0.61%. The report says that this was to be expected after an increase in stock and end of cycle rental reductions in 2012. However, London has shown three year rental growth of over 20%. Students in London currently pay an average of 300 per week for a studio accommodation. Alongside London Cambridge, Bath, Bristol, Oxford and Brighton all promise good returns on investment.
A dedicated student housing REIT has been launched on the London stock exchange that provides opportunity for small investors.
It makes perfect sense to benefit from the student accommodation investment UK but before you can see the promised results you will have to meet some responsibilities as a landlord. You will have to register your HMO with the council and secure a license.