Landlord News

Research suggests student landlords could achieve yields of 12%

Em Morley - August 16, 2017

A league table indicating in which cities landlord can enjoy the best returns on their student rental investment has been derived by Simple Landlords Insurance.

The insurance provider claims private rental accommodation in some university locations can provide yields of up to 12% per year.

Potential

In order to collate the table, the firm looked at the major universities as listed in the Complete University Guide, examining investment potential in every location.

St Andrews came out on top, with the chance of investors earning up to 12%. This was followed by Lancaster, Loughborough and Birmingham, with these locations offering the potential to achieve yields of over 10% for student landlords.

Other regions with the potential of substantial yields were Exeter, Durham, Sussex and Nottingham, with yields in excess of 9.5% per year.

A spokesperson for Simple Landlords Insurance said: ‘Unlike other studies, ours centred in on the house prices in the streets where students at each of the universities actually choose to live. It compared the cost of buying one of these properties with the rent that is actually paid by students studying at the establishments in question.’[1]

Research suggests students landlords could achieve landlords of 12%

Research suggests students landlords could achieve landlords of 12%

Returns

On the other hand, Oxford offered the lowest value of the universities covered by the study. Properties on a popular student area, Iffley Road, normally change hands for around £720,000. As a result, landlords can enjoy a yield of 3.33% – a high outlay for less lucrative returns.

The University of East Anglia in Norwich, Cambridge, Bristol and Surrey universities also feature at the bottom of the table.

The spokesperson concluded by saying: ‘One way to mitigate the risk is to invest in an area you know for a student you know – and we’re seeing more people with children at university choosing to invest and buy a property rather than see rent going down the drain.’[1]

[1] https://www.lettingagenttoday.co.uk/breaking-news/2017/8/league-table-claims-student-accommodation-gives-up-to-12-yield