20 Dec by Amy Jackson

3 Benefits of Student Property Investment in Leeds

Why is Leeds a Good Place to Invest in Student Property?

Located in the heart of Yorkshire, Leeds is one of the UK’s top-performing cities. In recent years, Leeds has gained a lot of attention thanks to its thriving property market, with growing property prices and high levels of demand creating some positive opportunities for property investors. Much like the popularity of student property investment in Liverpool and Manchester, one area of the Leeds property market which stands out is the Leeds student property investment market. Here are three reasons why you should consider student buy to let in this UK hotspot.

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The Benefits of Leeds Student Buy to Let

Manchester High Tenant Demand Manchester High Tenant Demand

High Rental Demand

One of the most important factors to think about before you make a property investment is whether or not the area generates consistent rental demand. With a student population of over 60,000 and a number of top institutions including the University of Leeds, Leeds Metropolitan University, and Leeds College of Art, those considering Leeds student property investment can expect plenty of demand.

Leeds is a popular city of choice for overseas students, with the University of Leeds alone attracting over 9,000 international students to its wide range of courses. With a high level of demand, especially from overseas students, Leeds has started to offer more high-end and luxury forms of student accommodation. With attractive features like super-fast WiFi, onsite security and maintenance, and communal areas for tenants to socialise, this new type of luxury student living is overtaking the more traditional shared housing style of student property. This type of purpose-built accommodation is on the rise across the UK, with £3.1 billion being invested into PBSA in 2016 – £72 million of which was spent in Yorkshire.

Ongoing regeneration Leeds Ongoing regeneration Leeds

Strong Growth Prospects

According to a recent report by JLL, property prices in Leeds are expected to rise by around 115 between 2020 and 2022. This is a substantial level of growth, especially when compared to London’s predicted growth of 4.5% by 2022. Next to demand, capital growth is another of the most vital things to consider when selecting your investment opportunity, which makes student property investment in Leeds a fantastic option.

The strength of Leeds when it comes to property market growth has a lot to do with the extensive regeneration which is ongoing throughout the city. Operating as one of the key cities of the Northern Powerhouse scheme, the economy of Leeds is said to have grown at a faster rate than London since the end of June 2014 when the scheme was first launched. Regeneration schemes planned for Leeds include the £161 million plans for Leeds train station, and the Southbank Scheme, which will extend the city centre and create new homes and offices for city centre residents. All of these new developments will not only improve the quality of life for students in the city, but also help grow the value of your student investment property in Leeds over time.

financial sector Leeds financial sector Leeds

Attractive Rental Yields

Student property investment is typically known as one of the best ways to generate high rental returns, and in an area like Leeds, your chances of strong rental yields become even higher. As a whole, Leeds boasts some of the most attractive rental yields in the UK, with an average yield of 4.29%. For a Leeds investment, student property can be a good route to take due to the fact that rental costs for student accommodation are increasing.

In Yorkshire and the Humber, the average annual rental cost for student accommodation increased from just over £4,000 to almost £6,000 from 2011 to 2018. With student developments priced from around £50,000 in many Leeds areas, investors are able to benefit from a large return on their investment in the form of impressive yields. Some of the best Leeds postcodes for rental yields include spots like Headingley, one of the biggest student areas of the city which generates yields of 7.4%. Other student areas such as Burley, Woodhouse and Hyde Park can create rental yields of 5 or 6%, leaving you with plenty of return on your Leeds student property investment. All in all, Leeds investment into student property is a smart move if rental yields are your main focus.

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