Investors in the UK’s student accommodation investment market, which has risen to prominence increasingly in recent years, are welcoming far better levels of income than they have at any time in the past, according to figures released by Knight Frank.
The property consultant’s latest report shows that demand continues to push the purpose-built market forwards as student numbers continue to rise across the UK, and it said that in the space of the last decade alone, the number of students living in this type of accommodation has doubled.
Rising student accommodation investment yields
Good news for investors that have entered student accommodation investment opportunities, the continued upward pressure caused by a rising student population has meant student property being one of only a few asset classes that has seen positive rental growth every year since 2007.
This shows just how far student accommodation investment market has come in the last few years, rising from its position as a niche asset to one where it is among the best performing in all of property.
In the last five years alone, Knight Frank said the average that a student would have to pay in order to live in purpose-built student housing has risen from £120 per week to £143, which has helped deliver higher student accommodation investment yields year after year.
James Pullan, head of student property at Knight Frank, suggested one of the main reasons that student property has emerged as a real power in the world of property assets is the fact that while other sectors are affected by uncertainty and political upheaval, the student market is one where consistency is the cornerstone.
So even at a time when the economy is struggling or political uncertainty is causing stalling elsewhere in property, people still want good quality university courses, which means they need somewhere to live, sustaining demand for the student accommodation investment market.
“The importance of higher education remains unaffected by the tumult of economic cycles,” he said.