As the rental market has adjusted to a Covid world, the student lettings market, in particular, seems set for a surge. As student rents are poised for a boom for the upcoming 2021-2022 academic year, investing in the students' lettings market could be a savvy move by landlords. New data has revealed where student rents have risen and this could mean improved growth in the 2021-2022 academic year.
Here at Kings Lettings, we cover areas in London, and in the capital city, there are 40 universities, meaning we could help landlords looking to go into the student lettings market. We also cover areas in Hertfordshire, such as Hertford, which is only 37 minutes away from the University of Hertfordshire.
What does the new data show?
Goodlord analysed 5,000 student lets processed through their platform between January and July and the data shows the student letting market recorded a huge surge in the cost of rent for tenancies that began during the end of that period. Greater London recorded its highest average rents for tenancies beginning in August.
Advantages of letting to students
Students aren’t picky
This is somewhat a generalisation, but students tend not to be as fussy over their accommodation as opposed to a tenant looking for somewhere to live more permanently. To get their work done, students will probably be more concerned about a good WiFi connection than whether or not the furniture is brand new.
Older properties with bigger rooms that have more than one toilet tend to be the best student properties. If you can convert a second room into a bedroom this could mean more money for you.
A steady supply of renters
For the 2019-2020 academic year, there were 2.46 million students in the UK at higher education institutions. Although some students live at home, the majority rent accommodation when they go to university. Usually, first-year students live in their halls of residence but after that go onto to choose accommodation in the private rented sector.
With a high student population, this can mean a steady supply of tenants for landlords. If you’re a landlord based in London, you could really take advantage of the promising student lettings market in the capital, as the city is consistently ranked as the best city for students. London is also home to one of the most populous universities, University College London, which has nearly 42,000 students.
Strong rental yields
The pandemic has caused fluctuations in the rental market, but the student lettings market has seen promising growth. With recent data showing a rise in rents and with the upcoming academic year looking to be more ‘normal, this can hopefully mean strong rental yields in the student lettings market.
No long-term contracts
Students don’t usually want to rent a room or property for longer than 12 months. This is great news if the tenant is uncooperative as you won’t have to put up with them for too long.
Low void periods
Voids are a huge issue for buy-to-let landlords. This happens when a tenant leaves a property and you can’t find another quickly and this equates to no rental income. A long void period can leave landlords out of pocket.
The academic year usually runs from October to June/July. Most students are usually fine with a 12-month lease, so they have somewhere to keep their possessions over the summer before the new term begins. This helps to remove the issue of void periods for landlords.
More room for more money
Landlords can charge rent per room, and there tends to be more tenants in a student let than there would be for family members or roommates in a similar property. It can be a savvy idea to convert areas into bedrooms to get higher returns.
Where can landlords invest in student lettings?
London and Hertfordshire are home to notable universities, which makes them great regions for landlords looking to make moves in the student lettings market.
Here at Kings Lettings, we have branches in areas in London, Hertfordshire and Essex which are at a reasonable distance from popular universities. Bethnal Green is less than half an hour away from popular institutions like University College London and the Queen Mary University of London. The University of Hertfordshire has 25,000 students and is a 24 minute or less drive from Hertford, an area we cover.
You need to work with an experienced, reputable letting agent. Here at Kings Lettings, we can help you to remain compliant and get the most from the tenancies of your home.
For more information on how we can assist you on your letting journey, please contact one of our branches in Essex, London or Hertfordshire today. We also offer a free and instant online valuation to give you an idea of how much your home could be worth on the current market/how much you could be charging in rent.
