Over the last year or so, PBSA has exploded in popularity amongst investors, with cluster flats and premium living spaces, in particular, on the rise.
In 2020, despite the obvious economic pressures caused by the global Covid-19 pandemic, there was more purpose-built student accommodation investment than ever before.
A report from Savills found that £5.77 billion was spent in the sector in 2020, which is 5.7% higher than 2019 and 0.8% higher than the previous record.
While those living in student accommodation fell from 98% in the academic year 2019/20 to 88% in 2020/21 – a symptom of students moving back home during lockdown – these numbers are likely to bounce back.
UCAS has reported that there has been an 8.4% increase in applications, stemming from a 17.1% rise in foreign applications from non-EU countries.
This rise in foreign applications is particularly interesting and poses a huge opportunity for investors.
According to UCAS, 130,000 university applications in 2021 came from Chinese students, who are around 2.2 times more likely to live in PBSA.
There’s already a huge divide between available beds and full-time students, with full-time students currently outweighing PBSA by 3:1.
Crucially, universities own about 69% of the UK’s purpose-built student accommodation, which is noteworthy as universities are relying on the private sector to help deal with this rising demand for quality housing.
With such a high level of students entering the UK, PBSA investments in cities like Liverpool and Manchester currently rank as the best.
This is because both cities offer some of the highest levels of Chinese students in the UK. In fact, in the University of Liverpool, around one in five students are Chinese, thanks to the cities long-standing history with China.
If you want to learn more about the best places to invest in student accommodation, be sure to check out our free guide.
Or, if you’re more interested in checking out specific cities like student property investment in Liverpool or student property investment in Manchester, you can check out our area guides for them.
Just click the links to read for free!
If you’re wondering how to invest in student accommodation, then RWinvest is the perfect company for you.
We have several fantastic purpose-built student accommodation investments for sale, with huge NET returns available up to 8%.
With prices as low as just £59,995, too, you can secure one of the most affordable asset classes in UK real estate.
To see the latest student accommodation investments for sale, then click the link to see our opportunities.
Pros:
- PBSA is far more affordable than traditional buy to let, with starting prices often below £100k.
- If you purchase new build student properties from investment companies, you will often get assured rental yields for a set number of years.
- Due to luxury onsite facilities like gyms and cinema rooms, rental income is high in PBSA.
- Thanks to highly affordable property prices and high rent, rental yields tend to be incredibly high for student properties, with returns around 8% or more.
- Huge demand for PBSA, with full-time students outweighing available rooms by 3:1.
- It can be a completely hands-off investment, with a dedicated student accommodation management company usually provided specifically for the development.
- With student property investment, you can earn income through both rent and capital appreciation.
Cons:
- Capital appreciation tends to be less than traditional buy to let property.
- Small resale market, as those looking to buy student accommodation will be other investors.
Why Should You Invest in Student Accommodation?
Over the last year or so, PBSA has exploded in popularity amongst investors, with cluster flats and premium living spaces, in particular, on the rise.
In 2020, despite the obvious economic pressures caused by the global Covid-19 pandemic, there was more purpose-built student accommodation investment than ever before.
A report from Savills found that £5.77 billion was spent in the sector in 2020, which is 5.7% higher than 2019 and 0.8% higher than the previous record.
While those living in student accommodation fell from 98% in the academic year 2019/20 to 88% in 2020/21 – a symptom of students moving back home during lockdown – these numbers are likely to bounce back.
UCAS has reported that there has been an 8.4% increase in applications, stemming from a 17.1% rise in foreign applications from non-EU countries.
This rise in foreign applications is particularly interesting and poses a huge opportunity for investors.
According to UCAS, 130,000 university applications in 2021 came from Chinese students, who are around 2.2 times more likely to live in PBSA.
There’s already a huge divide between available beds and full-time students, with full-time students currently outweighing PBSA by 3:1.
Crucially, universities own about 69% of the UK’s purpose-built student accommodation, which is noteworthy as universities are relying on the private sector to help deal with this rising demand for quality housing.
With such a high level of students entering the UK, PBSA investments in cities like Liverpool and Manchester currently rank as the best.
This is because both cities offer some of the highest levels of Chinese students in the UK. In fact, in the University of Liverpool, around one in five students are Chinese, thanks to the cities long-standing history with China.
If you want to learn more about the best places to invest in student accommodation, be sure to check out our free guide.
Or, if you’re more interested in checking out specific cities like student property investment in Liverpool or student property investment in Manchester, you can check out our area guides for them.
Just click the links to read for free!
How to Invest in Student Accommodation With RWinvest
If you’re wondering how to invest in student accommodation, then RWinvest is the perfect company for you.
We have several fantastic purpose-built student accommodation investments for sale, with huge NET returns available up to 8%.
With prices as low as just £59,995, too, you can secure one of the most affordable asset classes in UK real estate.
To see the latest student accommodation investments for sale, then click the link to see our opportunities.
What Are the Pros and Pitfalls of Investing in Student Accommodation?
Pros:
- PBSA is far more affordable than traditional buy to let, with starting prices often below £100k.
- If you purchase new build student properties from investment companies, you will often get assured rental yields for a set number of years.
- Due to luxury onsite facilities like gyms and cinema rooms, rental income is high in PBSA.
- Thanks to highly affordable property prices and high rent, rental yields tend to be incredibly high for student properties, with returns around 8% or more.
- Huge demand for PBSA, with full-time students outweighing available rooms by 3:1.
- It can be a completely hands-off investment, with a dedicated student accommodation management company usually provided specifically for the development.
- With student property investment, you can earn income through both rent and capital appreciation.
Cons:
- Capital appreciation tends to be less than traditional buy to let property.
- Small resale market, as those looking to buy student accommodation will be other investors.