Student property is one of the best investments available at the moment, thanks to high demand for student housing ahead of the new academic year.
Many buy-to-let landlords are reluctant to rent to students because they are concerned about the damage they could do to their property. But research reveals that student property now offer among the highest yields in the UK.
Landlords with student properties in Liverpool, for example, which is home to three universities, can now expect to achieve rental yields of almost 12%, according to recent research by Totally Money.
Liverpool's L7 postcode, is another good location for student property, with an average rental yield of almost 11% typically achievable.
The research unsurprisingly finds that most postcodes in the highest yielding areas have relatively low house prices, compared to the national average, suggesting that more affordable house prices generate better rental yields rather than more costly properties.
Paul Nicholson, CEO of Luxor Group: “Landlords and letting agents that let to UK and international students know they are getting some of the best yields in the country.”
He points out that new students often opt for halls or an HMO, which he adds “offers excellent yields for landlords from his own experience with 19-Bed HMO named 'Nicholson Mansion' close to Sefton Park”.
"We have seen a surge in students looking for high quality, HMO accommodation with close proximity to the universities and occupancy across our student accommodation is at 98%. “Shared student accommodation in Liverpool gives investors excellent yields. There are many areas of Liverpool that are ideal for student property investment such as Kensington, Wavertree & Toxteth"..
Investors can acquire a high quality, three bed HMOs which will house students from £120,000 onwards. An average room in an HMO can be rented for £85 per week including bills, but ensuites can be high as £110 per week. The return on investment is very attractive too, with 13% (8% cash rental and 5% capital growth).
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