Simon explores the question of whether investing in student property is a wise decision. The discussion highlights two distinct types of student accommodation: traditional houses converted into Houses in Multiple Occupation (HMOs) and purpose-built student blocks.
Simon examines the importance of location, quality, and understanding the academic cycle when investing in student properties
KEY TAKEAWAYS
- There are two main types of student properties: traditional shared houses (HMOs) that can be a good investment, and purpose-built student accommodation, which is generally not recommended due to various limitations.
- Successful student accommodation should be located close to universities and maintained to a high standard. Properties that are too far from campus or not well-kept tend to struggle with occupancy.
- Timing is crucial when investing in student properties. Many students start looking for accommodation in January or February for the following academic year, so it's important to have properties ready well in advance.
- Beyond students, properties can be repurposed for young professionals or other types of tenants, providing flexibility and potential for higher returns if the student market is oversaturated.
- Investing in purpose-built student accommodation can lead to high costs, limited exit strategies, and potential issues with long-term value. Traditional HMOs offer better opportunities for capital growth and tenant stability.
BEST MOMENTS
"There are two different types of student property, one of which I would not touch with a barge pole, and you should not invest in that type of student property, in my opinion."
"It's got to be very high accommodations. Don't think student accommodation is a slum alternative, not very good accommodation. Absolutely not."
"If you buy a purpose-built property like this, you are paying a very high price... you're paying far more than the bricks and mortar value."
"Investing in a purpose-built student accommodation block is probably better than doing no investment at all, but I think it's a little bit of a lazy way to invest."
"When you set it up correctly, student property can be very hands-off. It's not as intensive as another HMO where you see the tenants turning over a bit more often."
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Simon Zutshi, experienced investor, successful entrepreneur and best-selling author, is widely recognised as one of the top wealth creation strategists in the UK. Having started to invest in property in 1995 and went on to become financially independent by the age of 32.
Passionate about sharing his experience, Simon founded the property investor’s network (pin) in 2003 www.pinmeeting.co.uk pin has since grown to become the largest property networking organisation in the UK, with monthly meetings in 50 cities, designed specifically to provide a supportive, educational and inspirational environment for people like you to network with and learn from other successful investors.
Since 2003, Simon has taught thousands of entrepreneurs and business owners how to successfully invest in a tax-efficient way. How to create additional streams of income, give them more time to do the things they want to do and build their long-term wealth.
Simon’s book “Property Magic” which is now in its sixth edition, became an instant hit when first released in 2008 and remains an Amazon No 1 best-selling property book.
Simon launched his latest business, www.CrowdProperty.com, in 2014, which is an FCA Regulated peer to peer lending platform to facilitate loans between private individuals and property professionals.
