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Hi, I'm considering investing in student accommodation and wondered if anyone could tell me how it works with their terms? Are the properties empty for weeks/months of each year.
These 'voids' dont seem to be mentioned in any investment pitch.
Any advice appreciated, thanks, Mark
I can only speak for two areas, one where my child has been in student accommodation in four properties over the last four years in Brighton, the other my local area where I've viewed and looked at the details of many student properties, Portsmouth.
Both areas are totally different regarding this. Brighton all contracts have been twelve months plus bills, generally extortionate rent for places Rigsby would reject. Portsmouth now has a lot of purpose built blocks springing up. Contracts in shared student houses seem to be for ten months and include bills and properties seem almost like houses a non student would live in and much better condition.
The moral of these ramblings is the two markets are nothing alike so I think its best you research the specific area you're looking at via Rightmove and talking to local agents
Thanks for your advice, i hadnt appreciated there could be so much varience.
I'm certainly well into my internet based research atm with calls to agents/LA/university and hospital next on the list. Finally I'm planning to visit and potentially view some properties next weekend.
If all the ducks line up I'll go for it as student accommodation, fall back position-single let.
All the best, Mark
No problem. I'm sure there are better experts on here but these are my personal experiences. Good luck with everything
I think I made a comment re this a few months ago . My wife owns a Student Studio in a block of 90 in a Scottish University City . The main points re Student Flats are the yield can be good bu there is very little capital appreciation . The managers try to sign the students up to say 50 weeks but will sign them up to shorter periods if need to . block our studio is in has high speed wifi gym common room and concierge and cleaning . Hot water and heating included in rent of £135 per week .
There is firm called Watkins Jones building masses of new blocks everywhere so what was a good investment is becoming less so
I've some experience in Loughborough, Stoke, Sheffield. The markets are all quite different and I guess it's a supply and demand thing. I've seen anything from a 44 week rental up to a full 52 weeks. I would say the average was 52 weeks with half rent for 8 weeks in the summer so 48 full weeks. By having them signed up for 52 weeks (even if not paying in full) means no gaps in rental so no liability to you for Council Tax for the gap weeks.
Overall I found it is a minefield out there to work out which area, which area is a fringe area (so higher yield) and which areas are dying student areas (so possibility of no rental one year) - oddly enough it is the latter where there are likely to be houses for sale ;-) . Also timing is tricky - if I was buying in the first six months of 2019 then you'd really want the house to be already let for academic year 2019/2020.
Oh and forgot to say I'd bargepole the purpose built stuff which is declining in many places, seeing lots of empty rooms and doesn't appeal to many students. And is often overpriced relative to other decent PRS accommodation.
Yes the PBSA's are a mixed bag for students. They appeal more to foreign students whose parents can see the flashy website and pay the exorbitant weekly amounts Vs. the UK students who seem to prefer the houses after their first year in halls which are generally a lot cheaper?
Yes I think that's right, the overseas ones will pay up.
Sincere thanks for that, there's some great nuggets of advice in there, much appreciated.
"""""""""""""""Hi, I'm considering investing in student accommodation and wondered if .................etc etc etc...
These 'voids' dont seem to be mentioned in any investment pitch.""""""""""""""""""""""
Funny that eh? Tells you all you need to know about those investment pitches & the investment salesmen...(yes, salesmen...) Avoid: