I never realised how expensive student rents were until my daughter went to university last year. As she still has another three years left, I am considering buying something for her to live in, then rent it after she finishes. Do you think this is a good idea and something worth investing in?
Dear Wealthy Parent,
Student accommodation is indeed very profitable as long as you carefully carry out your research beforehand to find out what type of property rents out the easiest as well as focusing on a small radius in and around your chosen university.
Year-on-year, demand is high given students often have no choice but to move off campus after the first year.
They all need to find somewhere to live, so it is pretty much guaranteed that you will have continued occupancy with very few void periods.
Most will stay at least two years and even if they are not renewing the agents tend to advertise the property up to six months ahead of time to secure the next set of tenants.
This is why it’s worth exploring the local agents that have the market on student accommodation and getting them to manage the property for you.
These agents will usually be on a list of preferred housing, hence receiving the most direct traffic from students.
They will also be used to dealing with renting to students, which can be very different to a regular let given the rent is often split between several individuals all of which typically need guarantors.
You may also find that one student will want to leave a property but three may stay on so using a specialist agent would be preferable. Also, finally remember that student accommodation usually falls under “houses in multiple occupation”.
A landlord may need a licence for this type of property as well as to meet extra responsibilities that are additional to your usual repair responsibilities as an owner of accommodation.
Dawn Sandoval is the owner of Dawn Sandoval Residential in Canary Wharf.