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How Thinking Like a Student Can Boost Your Property Investment Returns

Generating more than £6 billion worth of investment in 2015, the UK’s student accommodation market is no longer a niche investment product.

Thinking Like a Student For Property Investments UK

With more than 2.2 million students living in the UK, and the government’s restrictions on university admissions numbers now lifted, there has never been a greater audience for Purpose Built Student Accommodation (PBSA).


The success of the sector has seen everyone from individual landlords to some of the world’s largest investment funds enter the student accommodation market. Offering buyers generous rental returns and a captive market of student tenants, it has become the fastest growing asset class in the UK.


However, with the success of the sector comes a wave of new student accommodation developments across the UK’s most popular university towns and cities. With so many options now available to the market, each offering similar rental returns, how can investors know which developments are most likely to attract maximum occupancy and perform beyond a rental assurance period?


Using the PBSA developments at Huddersfield's Waterside Quarter, we can show you exactly what students are looking for from their accommodation, and how knowing can help to improve your chances of enjoying success with your investment.

 

Student Property UK Investment

Image: Huddersfield's Waterside Quarter's modern studio apartments


Finding the best place to live


As with any property purchase, location is essential. Whether you are looking at a traditional buy-to-let property or a development within the student sector, if the location is incorrect, your returns will be affected.


For the majority of students, location is one of the deciding factors when choosing their accommodation. One of the factors for students throughout this process is how close their home will be to the university.


By being close to the university, students are able to enjoy quick access to lectures, whilst minimising the time it takes to travel to and from the campus.


University provided student villages such as Storthes Hall in Huddersfield have seen accommodation developments built several miles from the campus, meaning that students are forced to rely on public transport to access their university campuses.


Purpose built student accommodation developments such as Crane Court at Huddersfield's Waterside Quarter have learned from the issues that have arisen from these out-of-town developments, factoring in the proximity to the university when entering the development stage.


Huddersfield's Waterside Quarter is less than 150 metres from Kirklees College and 600 metres from the University of Huddersfield campus, making it ideal for students looking to minimise the distance between their home and their place of study.

 

UK Student Accommodation Investment

Image: Huddersfield's Waterside Quarter​ in the foreground with Kirklees College standing just metres away


Whilst being close to the university is often the main factor in students selecting the location of their student accommodation, having the town or city centre nearby is almost as important.


Students are increasingly looking towards town centre developments that still allow for easy access to the university as their ideal location for accommodation.
Most popular PBSA developments are located near to local shops or supermarkets that can allow students to shop for basic grocery items, but this is no substitute for the choice available in an urban hotspot, with its range of retail, leisure and cultural activities.


Located just 0.16 miles from the town’s main shopping centre, the Kingsgate Centre, Huddersfield's Waterside Quarter allows students to experience the best of both worlds – close proximity to the university, whilst ensuring that the town centre and its nightlife easily accessible.

 


Finding more than just a place to sleep


Traditionally, the UK’s student housing has been portrayed in the media as being a series of run down terraced houses, poorly maintained and filled with tenants who treat the property just as badly.


This is no longer the case. The modern British student has a taste for something better.


In recent years, the student market has been revolutionised as students have started to move away from the often run-down and limited options available within houses of multiple occupancy (HMOs) and towards PBSA.


Having a bedroom in a house is no longer enough for many students, they are looking to have the opportunity to live like a young professional, instead opting for studio apartments with dedicated kitchen facilities, study areas and an en-suite shower room.


Student Studio Apartments Huddersfield

Image: The state-of-the-art cinema suite available for tenants at Huddersfield's Waterside Quarter

 

Developments such as Huddersfield's Waterside Quarter are also going further, with the developers taking their cue from the hotel sector to provide an exceptional range of luxury facilities, each catered to suit the interests of the town’s student population.


A games and television room, offering a pool table, foosball table and large screen television within a modern and comfortable lounge area will provide students with a place to relax in their spare time. The state-of-the-art cinema suite enables tenants to enjoy a full cinematic experience just metres from their apartments, showcasing a range of films for the development’s occupants.


The bespoke fitness suite will be filled with specialist gym equipment, allowing students to enjoy the benefits of joining a gym, but without the prohibitive costs, whilst a dedicated study room, specially designed to provide computer access in a quiet space, allows students to complete their university work in peace.


By including this range of facilities, developers are able to attract a broader range of tenants, providing students with access to a number of expensive services that would otherwise be beyond their reach. For a slightly higher rent, students can instead enjoy this access as a part of their everyday accommodation.

 

Kingfisher House Huddersfield

Image: The dedicated study area at Huddersfield's Waterside Quarter​


Finding value for money


With students in the UK demonstrating their desire for a higher standard of accommodation, as well as their willingness to pay more to live in developments that provide this, the focus of tenants has moved from simply looking for the least expensive accommodation option. They now look for the option that provides the best value for money.


The continued success of the PBSA sector has seen the student accommodation market further diversify, creating a varied market with properties available to suit every budget and taste. As a result, there can be a vast difference in the rental rates charged to student tenants.


In Huddersfield, Aspley House, recently consolidated into the new Goldman Sachs owned Vero Group portfolio as part of the Prodigy Living brand, offers student tenants the option of en-suite rooms, bronze studio apartments and silver studio apartments, with rental rates of £109, £189 and £199 per week respectively for the 2015/16 academic year.


Located to the south of the University of Huddersfield campus, Aspley House has recently installed a gym for students to use but does not offer any other specialist communal facilities.


Buy-to-Let Student Property

Image: The well-equipped gym for students at Huddersfield's Waterside Quarter​


Conversely, Huddersfield's Waterside Quarter’s rental charges range from £135 per week for its studio apartments, with the development providing a gym, a dedicated study area, a game and television room and a specialist cinema suite.


The disparity in rental rates throughout university towns and cities throughout the UK means that students are now able to find better standards of accommodation, with rooms and studios available for rental rates that offer greater value than those that are currently available at operational developments.


By investigating the comparable rental rates at competing developments, you will not only discover whether the rents a development is advertising are achievable, you will also be able to gain an understanding of whether that development can attract student tenants when compared to other developments.

 

Investment Student Studio Apartments

Image: Each studio apartment is complete with a beautifully designed en-suite shower room


Finding the best living experience


A crucial aspect of any property purchase is being able to place your trust in those who are selling a development to you. For investors, this is particularly important as the developer and contractor will be the people helping you to achieve your rental return.


Whilst this knowledge may not seem to be at the top of a student’s checklist when selecting their accommodation, it is the combined efforts of these parties working together to create a desirable living space that ensures that the tenants are enjoying the best possible experience during their tenancy.


In creating a high quality and professional development such as Huddersfield's Waterside Quarter, developer Mederco and construction team Elements Construction, are working together to provide affordable student accommodation that offers a modern and comfortable finish for its tenants.


Huddersfield Student Accommodation Investment

Image: The communal games and television area available to access for students


Having previously collaborated on several student developments, Mederco and Elements Construction have an understanding of the quality of construction and rental management required to make a new student development a success.


By sourcing tenants through local agencies who understand the market in Huddersfield and by offering management services using their own specialist knowledge of the student accommodation market, Mederco are able to offer a service tailored to the needs of tenants and based on their experience.


Through ensuring that you choose to purchase from a developer with experience in the student accommodation sector, you can not only be more confident of the financial performance of the development, you can also be assured that they will be able to provide the students with a positive living experience.

 

UK Student Investment Properties

Image: Each studio apartment comes complete with a desk area, kitchenette, dining table and bed

 

Finding the best student property investment


By taking into account how a student selects their accommodation whilst at university, it is possible to gain a new perspective on a development, allowing you to better understand why a development may or may not succeed as your next student property investment.


Here at PrinvestUK, we have have witnessed the journey that this market has taken from an alternative investment property type, to one of the UK’s leading property asset classes. As the student population of the UK grows and this property sector continues to develop, we will continue to bring you the very best in UK student accommodation developments, such as Huddersfield's Waterside Quarter.


For more information about the student property market, and to view our full range of student properties available for investment, please visit our Student Accommodation section.