Like residential buy-to-let, student buy-to-let is when an investor purchases a property with the plan to let it out to tenants.
The main difference between residential and student property investment is the group of people who rent the property, as student buy-to-let only accepts student tenants.
Therefore, student buy-to-let is often located in major cities or close to university campuses to help attract potential tenants. They may also be HMOs, which we explain further down in this guide.
Many students prefer modern new build properties, however, with studio apartments being popular.
Pros of This Type of Investment Property
- The UK attracts many students each year from the UK and overseas, leading to high demand for student rentals.
- Property prices for student investments are often low due to a tendency to be studio flats.
- Rental yields can be high with this type of real estate investing due to the pairing of low property prices and high rental costs.
- Student properties are often located in major property investment hotspots such as Liverpool and Manchester.
- Student investments are often hands-off as they will be managed by a property management company, making this a good rental property to invest in if you want to keep your investment as hassle-free as possible.
Like residential buy-to-let, the returns that come with student investments are:
- Rental income paid by the tenant every month.
- Returns through capital appreciation, provided that the property has grown in value by the time it is sold.
Due to student buy-to-let properties often being studio apartments, prices are generally low.
Manhattan studio apartments are also becoming a popular choice as a studio with a secluded bedroom giving tenants a mix between traditional studio flats and one-bedroom apartments.
With many new developers choosing to fit their projects with Manhattan studio apartments over traditional one-bedroom or studio flats, this trend is becoming one of the most popular property investment types in the UK.
In the past, we at RWinvest have sold student flats for less than £60k, such as with our City Point development which had units priced from only £59,995.