UK Student Property Remains Popular Choice for Investors Despite Brexit

Since 2012, the UK’s student property sector has received over £3 billion worth of investment per year and 2016 was another strong year for this buoyant market.

£3.1 billion invested in 2016

Figures released by Cushman & Wakefield have shown that £3.1 billion has been invested in the UK student property in 2016.

This marks the fifth year in a row where investment levels have exceeded the £3 billion mark. Second to 2015 – where over £5.7 billion was invested in the sector – 2016 recorded the next highest total level of investment.

Throughout the course of 2016, the average price of a bed was £73,000.

Investors avoid London

The report from Cushman & Wakefield also revealed a trend of investors buying student property in the regions, making London less of a focal point.

University cities including Manchester, Liverpool, Leeds and Birmingham have emerged as a popular choice for investors who have been enticed by rising student numbers.

Student property is no longer considered a niche asset by investors who have seen the value of stock in this sector rise. Increasing student numbers, rising rents and a strong demand for rooms have promoted investors to expand their portfolio into this flourishing market.

Mike Mitchell, partner in Cushman & Wakefield’s student residential investment team, explained: “The growth in student numbers, including those from overseas, continues at pace.”

Lesser known towns and cities across the country have also benefitted from an influx of investment including Luton. The town, which is just over 20 minutes by train from London has seen an influx of investment in the market.

Experience Invest, the town’s main provider of purpose-built student rooms in Luton, recently opened the doors to its second student development in Luton.

“The demand for new-build student rooms in Luton remains strong. Students staying in our Chapel Street development see the value for money this type of accommodation provides them, as all bills are included in the price. They are also impressed with the free access to the on-site facilities and many of our second and third year residents have commented on the large sizes of the bedrooms,” Dale Anderson, Project Manager at Experience Invest commented.

With 2016 now named as the second biggest year for the UK’s student property market, rising rental returns and a continued demand for housing in this sector will undoubtedly propel the sector into the limelight in 2017.