The reality of being a landlord to students now is entirely different to 10 or 20 years ago. Modern undergraduates have high expectations of their accommodation, including ensuite bathrooms, wi-fi and even flat-screen televisions.
However, whilst students may end up in large amounts of debt when they graduate, they also have more cash to use than those studying even only a decade ago, according to James Davis, the chief executive of Upad, the online estate agency.
In line with the increase in cash, undergraduates are more selective and shrewd in their requirements, as evidenced in this article from The Guardian. Contrary to popular opinion, they are often very reliable tenants due to the rent payments being financed by their student loan and parents often acting as guarantors.
The standards these students demand in their housing may mean more initial investment but the returns can be significant. It is also easier than ever to protect investment with the introduction of property inventory software, such as that available from inventorybase.com.
The nature of undergraduate life means an additional benefit when providing student accommodation is they tend to be arranged up to six months in advance, which reduces the possibility of an empty let. In addition, as noted by Sally Fraser, of Stacks Property Search, students are a secure market however the economy is performing.
Location, location, location
In addition to wanting clean, well-equipped properties, students also demand proximity to both their university and their social life. This requirement can lead to high demand and therefore good returns in a number of areas. For example, in London students may be from overseas and wanting a centrally located flat either on their own or with just one other student. Good areas for this include City Road, which is walking distance from City, University of London or Bow and Mile End, which are both close to Queen Mary.
Manchester is another strong area for consideration as highlighted by Rob Bence from The Property Hub. With the largest student population in Europe, Manchester is likely to be in high demand. In addition, the north west is likely to provide the highest yield for landlords, with two bedroom properties generating double the gross rental yield in comparison to London.
By carefully researching and making considered decisions, landlords can find a safe, assured investment.