Is Student Accommodation Still a Good Investment?

Photo credit: Nottingham Trent University

If you have never considered becoming a property investor, now is the time to change your mind. Investing in property is a great way to earn income and capital gains. Over three-quarters of the world’s millionaires used property as their springboard to wealth and you can too, provided you pick the right properties.

One of the best forms of property to invest in is student accommodations. They have a lot of advantages over traditional properties: they are rarely empty, it is easy to find another tenant and they provide an almost guaranteed source of income. As with any other type of investment, there are a few caveats to keep in mind, however.

Why Student Accommodations?

Universities are growing rapidly. Enrolment in college is the highest it has ever been. Many schools have waiting lists for admission and even more have too many students to crowd into on-campus housing. This means the market for off-campus student housing is booming. Investors are cashing in on this burgeoning market by snapping up rental properties. Sell a house that is close to campus and it will be snapped up in no time.

Location Matters

The old real estate adage applies to student accommodations as much as, if not more than, other forms of property. The closer a property is to campus, the more you can charge in rent. Likewise, the further a property is from the school, the less you can charge. The ideal property is right across the street from the university. Students will pay dearly for the ability to walk across the street to get to class. If the nearest properties are out of your reach, look for properties that are within walking or biking distance. You should only consider a property that is more than a few miles from campus as a last resort.

Amenities are Important

How do you differentiate your property from all the rest? Students are very social animals so a big kitchen and lounge will be great selling points. Add in appliances such as a dishwasher and free internet access and you’ll soon set your property apart from the competition.

Houses and individual apartments fetch higher prices than shared living quarters. A multiple residency building that rents several bedrooms around a shared living room or common room and kitchen may be more traditional, and they may have more tenants, but the per-tenant rent is generally lower than that of a all encompassing apartment or house assuming all other factors are constant.

Other Considerations

If you will be renting your property to more than one person at a time, consider signing a separate lease with each tenant. This will tie each person to the property and protect your interests because even if one tenant defaults, the others will be on the lease and therefore required to pay.

Also, consider advertising your property even when it is full. The idea is to have a waiting list, so when one tenant moves out, another will move in right away, and the property will never be empty.

Above all, be careful when you choose your property. Once you have purchased a property, you can sit back and enjoy your investment!

If you have a property to rent why not rent it with My Online Estate Agent, the nationwide low cost estate agent.

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