Two good reasons to rent to students

Student demand for rental homes is high

New research published this week reveals good returns for landlords who buy properties near universities to rent to students. Good news for buy-to-let investors. But not everyone is keen to rent a home to students. Key issues are likely to be additional wear and tear on fixtures and fittings and the expectation that your property will be let fully furnished.

However, there are two good reasons to consider student tenants. First, demand for a rental property in university towns and cities is consistently high, and second, students are likely to want at least a 12-month contract, so you may not need to change tenants or market your property so frequently.

Despite the recent exam results fiasco and the prospect of Covid-driven online learning for many of this year’s under-graduates, demand is still expected to be high for student rentals. So which areas are currently generating the best yields? 

Landlord Today reported this week that “on average, university rental yields sit at 4.4% across the UK”. The most profitable returns are in Scotland, with best buys close to the University of Dundee where rental yields in the DD1 postcode could be as high as 7.2%. The University of Aberdeen comes in second with an average yield in the AB24 postcode at 6.8%, while the University of Strathclyde and the G1 postcode average rental yields of 6.6%.

In England, the University of Leicester is reported to be the best buy-to-let prospect. Yields average 6.6% in the LE1 postcode. Aston University in Birmingham also presents good rental opportunities (6.5%) together with the University of Leeds (6.41%), Nottingham Trent University (6.4%), Newcastle University (6.3%) and the University of Liverpool (6.1%). In Wales, Cardiff University has a yield of 5.9% in the CF10 postcode.

If you’re looking to buy a property with the intention of letting to students, we suggest looking for houses or flats with at least three bedrooms. Homes with good-sized or open-plan shared space and more than one bathroom are likely to have the most kerb appeal. And for obvious reasons, properties within walking distance of the university you choose are likely to be in demand.

If you are keen to market your rental home to students, why not do it via PlanetRent. Our automated lettings platform makes it easy for you to comply with all the regulations around letting a home in multiple occupation (HMO) and it already has a tie-in with Rightmove and Zoopla so you can promote your property on the UK’s two most popular portals on a pay-as-you-go basis. It’s all set up for you so, in just a few clicks, your home could be advertised to thousands of potential student occupiers in time for the start of the new academic year.

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