Student Accommodation Investment – What are the advantages?
Have you been working as a property investor for a while now? Or are you just starting? In both situations, you must be aware of the purpose-built student accommodation (PBSA) properties as well as the investment scopes that are present. A massive amount of property investors has been mulling over this investment opportunity. They try and think if it’s a smart investment opportunity.
Do you resonate with that as well? If yes, then the benefits of student accommodation investment options will help you decide better.
- There’s no stamp duty
The Student Accommodation entry level has a specific cut off rate. That makes the investors not pay the Stamp Duty rates, which was introduced by The Finance Act 2016. However, at times there are exceptions as well.
- Carefully managed
The student developers will usually appoint a specialized student accommodation management company to operate the entire site effectively. It comprises the sales method of allowing the properties, maintaining both apartments/rooms, and efficiently managing the overall tenant lifecycle. You will notice the rate to be much more in the high street agents for the daily residential properties. However, it gets justified because of the excessive communal facilities and the inclusive pricing structure.
- Longer and higher assured returns
The brand-new build buy-to-lets usually comes with assured rental returns for about three years. It acts as an incentive to the users. Also, it enables vast quantities of units that get drawn in the market and don’t allow the owners to sustain long void. Additionally, the Student Accommodation will result in a higher yield percentage and for a long time. It is expected of the developers to provide anything between 8% and 10% NET returns for about five years. It is one of the profit points for maximum investors.
- A strong demand
In the majority of university cities, a student doesn’t have the correct accommodation. Sometimes, there are no accommodations for students at all. Several universities come with several thousand residence room halls, and the rest need to go and find out from the house share options. But that is not with every city. You can check out the condition in your town before you plan to invest.
- Lavish facilities
PBSA tends to get costly for prospective students instead of conventional choices. However, the inclusive agreement, as well as the onsite facilities, gets a massive attraction as well. Here the Wi-Fi and bills also get added for making this a good option. Additionally, the meeting rooms, bars, social areas, prime locations, meeting rooms, rooftop terraces, and the like usually dedicate a social program and generate demand. The parents generally play an essential part in the decision-making process. There are also other elements like a secure key card system, onsite 24 x7 security, active maintenance service, and approachable site management teams. It means that parents usually support dedicated student properties. From the investor perspective, when there’s a high-end product that can get compared to other market alternatives, it will fetch in rental income.
These are a few advantages of student accommodation investment opportunities. The above pointers will help you decide better about your investment opportunities.