The UK’s 5 Best Student Towns to Invest In

UK's 5 best student towns to invest in

Student property is one of the best investments available at the moment. Demand for student housing is increasingly high, leading to more and more Purpose Built Student Accommodation (PBSA) developments being built to overcome what seems like an endless shortfall in supply. This buoyant market has proven to be increasingly resilient, and in the past two years foreign investors have almost doubled their share of the market. But which areas of the UK offer the best opportunities for investment in the student market? We’ve done some comparing of the markets this year, and here are our 5 top student towns to invest in:

 

Plymouth University, UK

1. Plymouth

Plymouth, a port city in the south-west of the UK, is home to several well-regarded higher education institutions. Chief among them is the University of Plymouth, which is ranked in the top 2% of universities in the world. It has a student population of around 23,000, with the university only being able to house about 12% of them. It is actually one of the UK university cities with a chronic undersupply of housing. According to JLL’s 2017 report, the coastal city has only 20 to 30 per cent of PBSA relative to its student numbers. Last year Plymouth University welcomed 23,155 students. Yet, the Complete University Guide notes that there are only 2,800 rooms available for students from Plymouth University itself. However, thanks to the enforcement of Article 4 and an unyielding lack of previous developments, new PBSA developments like Beaumont Square are now able to cater to this hungry market. The real lack of supply is a good sign for potential investors, as there is sure to be constant demand for their property.

  • Student Population: 23,000
  • Amount of Housing Available Through University: 2,760
  • Potential Yields: 8% per annum

 

Huddersfield train station, UK

2. Huddersfield

The market town of Huddersfield in the county of Yorkshire is seeing a large amount of investment at the moment. Most notably the £74million regeneration of Kirklees College’s Waterfront Campus. This is just one of four excellent higher education institutions in the town, including the University of Huddersfield which was named University of the Year in 2013! This has led to a student population of nearly 40,000 in the area. But once again, a lack of suitable housing has proven a real issue for these young people, many of whom have to travel to their campuses by bus from 4 miles away. This is why new PBSA, such as Crane Court – a mere 10 minute walk away from Huddersfield University and right next door to Kirklees College! – is proving to be so popular with students and investors alike.

  • Student Population: 40,000
  • Amount of Housing Available Through University: 4,465
  • Potential Yields: 9% per annum

 

Bristol aerial view, UK

3. Bristol

The historic city of Bristol is a thriving place, full of creativity and popular with young people. Which is in no small part due to the two prestigious universities it hosts. The University of Bristol is frequently ranked within the top ten institutions in the UK, whilst the larger University of West England boasts a 96% rate of graduates entering the workforce or further education within 6 months of graduating. And between them they have drawn around 50,000 students to Bristol. And the University of Bristol is hoping to grow their cohort by 3% this year, despite currently only having housing available for just 6,000 students.

Bristol itself is becoming a major property hotspot thanks to being voted the best place to live in the UK in the Sunday Times’ 2017 poll and prices rising faster than London in recent times, priming the local market for lucrative new PBSA investment. Upcoming developments, such as Tudor Hall, is well worth keeping your investor eye out for.

  • Student Population: 50,000
  • Amount of Housing Available Through University: 6,000
  • Potential Yields: 8% per annum

 

Port of Liverpool, UK

4. Liverpool

Liverpool is another place that is currently enjoying a frenzied ‘hotspot’ status within the UK property market. Whilst it has long been a hub for creativity and investment, massive amounts of regeneration have spurred the city into somewhat of a renaissance in the last decade or so. This has helped bring approximately 67,000 students to Liverpool’s many higher education institutions. Whether studying at the University of Liverpool, Liverpool John Moores, Liverpool Hope or even Liverpool Institute for Performing Arts (LIPA), students, particularly those coming from overseas, are increasingly looking to more upscale PBSA options for their housing. Developments such as Devon House, in the heart of the city’s student district, offer both residents and investors a promising prospect.

  • Student Population: 67,000
  • Amount of Housing Available Through University: 4,500
  • Amount of Total Student Housing Available: 17,857
  • Potential Yields: 8% per annum

 

Leeds aerial view, UK

5. Leeds

Top universities such as the University of Leeds, Leeds Beckett University, Leeds Trinity University alongside highly-regarded institutions including Leeds College of Art and Leeds College of Music, make Leeds an incredibly popular student city. With so many prestigious establishments, it’s not surprising that nearly 70,000 young people come to study in the city. This blossoming student population has caught the attention of developers. This, in turn, has led to Leeds becoming a popular choice for those looking to invest in PBSA. Viable city centre sites are now becoming particularly hard to come by, meaning demand from both investors and tenants for new and existing developments has remained high. If a new development springs up it’s highly recommended to understand what it could offer. Even some resale options that come to market are worth pursuing dependant on location and price.

  • Student Population: 70,000
  • Amount of Housing Available Through University: 9,050
  • Potential Yields: 8% per annum

 

Student Housing Demand

Top 5 UK Student Housing Demand and Supply Cities in a Graph, 2017, by Aspen Woolf

 

With the student property market proving to be such a lucrative and reliable investment in the current economy, these five areas of the UK offer some of the best returns for investors, with all producing average rental yields of around 7-8%. These cities are all still extremely undersupplied for student accommodation, meaning your investment will still be under continual demand for years to come.

 

If you want to know a bit more about student investment, we suggest you read how Student Properties Are a Safe Bet For 2017.

And if you are interested in investing in student property, take a look at the developments we currently have available.