As increasing numbers of the newest, luxury loving, premium demanding generation are going off to university, the demand for high-quality student accommodation in the UK is at an all-time high.
No longer will students settle with the sub-par, damp conditions that students have had to endure for years before.
The National Union of Students (NUS) has recently conducted a survey on university students regarding their opinions of their current or past experience with student accommodation. On average, it was found that out of every 10 UK students, 4 of these would deem their privately rented accommodation as “substandard”, reporting a plethora of issues. Out of all students surveyed, 42% of these reported frequent problems with damp and insulation, whilst another 16% admitted living in houses with numerous electrical issues.
In additional to these direct issues that the students are faced with in their day-to-day living, a whopping 37% of students surveyed by the NUS stated that they have never been provided with the correct paperwork to ensure that their deposits were being held safely by the correct agency, despite this being a legal requirement for all tenants in the UK.
Student property standards increase
It is not news to anyone that there have always been numerous issues found with old-fashioned student accommodation, rented out to students by largely amateur landlords.
This type of accommodation has, for many years, been the only option for students in their second and third years of university, having to accept what they can afford in an area close to campus. However, this is now changing, and its changing quickly.
A growing number of students
Statistics released by UCAS highlights the ever-increasing number of students attending university. Proportionately, there was a 0.3% increase in applications for university in 2018, with this figure anticipated to be higher in 2019.
With a substantial 8% rise in rest of the world applicants (up to a record high of 65,440 for 2018), the need for accommodation is set to keep growing.
Interestingly, and unlike the rest of the UK housing market, the economy had little bearing on the number of students attending university. CIPD highlight this, whereby as an economy falls in an area, with less job opportunities available, the number of university applicants actually rises. With Brexit itself appearing to play little part in the demand by rest of world applicants and a falling economy, we may see the number of university applicants rocket.
An investment opportunity
With a 68% rise in demand in the last 8 years for purpose-built, modern, student accommodation, there is great potential for investors in the UK student property market to achieve high long-term returns – there are ample student accommodation investment opportunities available to investors.
Net asset value in student property was up 7.2% across 2018, according to property experts DIGS. This figure is a result of the ever-increasing number of applicants going to university, and an increase in rental price for private student accommodation.