Come September, over 500,000 students will pack up their bags and head for university. While for them university might be the best time of their lives, for you it could be an excellent investment. Over the next few months university students will begin to think about accommodation for the upcoming academic year, with places in halls of residence predominately being taken by first year students. However, the bulk of students will be aiming to find housing, and that’s where your investment comes in!
Buying a property in a university town to rent out to students is an excellent investment opportunity; here are top uni towns to consider:
1 – Brighton
The seaside town is home to not only the University of Brighton, but also to the University of Sussex, meaning the town is full of students looking for accommodation. A property in this region can expect gross yields of between 6-8%.
2 – Glasgow
A 4-bedroom property in Glasgow is likely to set you back around £260,000, but will allow you to make back in the region of £1,100 a month with gross yields likely to be up to 5%. The Scottish city is home to the University of Glasgow which has over 25,000 students. There are also 3 other universities in the city: University of Strathclyde, Glasgow Caledonian University, University of the West of Scotland, bringing the total number of students to over 53,000.
3 – Manchester
Boasting over 400 pubs, clubs and bars in the city centre, it’s no wonder Manchester is the uni town of choice for 50,000 students. A 4-bedroom property in the city usually comes at an asking price of around £275,000; if fully occupied it would be set to make returns of over £1,000 a month.
4 – London
There’s no denying that property prices are higher in the capital, but so too are the returns that can be made by letting them out. Ranked as the 2nd best student city in the world, London is home to 366,605 students. With an average asking price of £995,000 for a 4-bedroom house, buying a property in London is up to 3 times the cost of a house in other university towns; however you can expect to earn around £3,400 a month in rent.
5 – Birmingham
With 65,000 students, Birmingham isn’t short on people looking to rent! Britain’s second city is host to 5 universities, the most notable of which is Aston. A property housing 4 students will set you back around £270,000 but can be rented out for an average of £770 a month.
6 – Southampton
Southampton’s two universities have helped the town’s landlords receive average gross rental yields of 8.73% in 2014. The average price of a house in the area costs £143,000 and has the potential to reap about £1,040 in rent each month. The seaside town is proving popular with students and is great for a long-term investment.
7 – Reading
At a 30-minute train journey from London and with one of the greenest campuses in the UK, Reading is home to both the University of Reading and a campus of the University of West London. Although property prices are slightly higher than in many northern university towns, a property costing £207,934 is likely to make back roughly £950 a month and has an average gross rental yield of 5.48%.
8 – Oxford
Home to the prestigious university and famed spires, Oxford University boasts 22,000 students – quite a large number for a relatively small town of around 150,200 inhabitants. Properties in the town sell for an average of £254,000 and receive an average rent of £1,489 a month. Additionally, Oxford is a tourist destination all year round, meaning that if the property is vacant over the summer there is also the option of renting it out to holidaymakers.
9 – Coventry
In 2014 it was announced that Coventry is the fastest growing city outside London, with a student population of 30,000. Coventry has two universities; Coventry University in the city centre, and the University of Warwick, situated 3.5 miles south of the centre, meaning there’s no shortage of areas in which to buy a property. The average price of a two-bedroom house in the Coventry area is around £110,000 and has an average yield of 6.4%.
10 – Nottingham
Two-bedroom flats in Nottingham can be found for around the £110,000 mark and in 2014 saw an average yield of 7.67%. The town has two universities with a combined student population of around 52,000, and is conveniently located near the M1.
11 – Bristol
Bristol has a lot going for it, including great night-life, an excellent west-country location and two major educational institutions: the University of Bristol and the University of the West of England. Affectionately called ‘Brizzle’, the city has 48,000 students and houses have an average price tag of £179,921. Although, if you’re willing to part with the cash, it’s possible to find 7-bedroom properties for around £1 million.
12 – Blackpool
An average rental yield of 7.63% makes Blackpool a prime (if surprising) location for property investment. With property prices around £77,000 you needn’t spend a fortune to find a decent investment. The popular seaside destination isn’t made up entirely of stag and hen parties, but also has Blackpool and The Fylde College. The university doesn’t have its own halls of residence and as such it’s a great location for buy-to-let investments.
13 – York
Great transport links and over 15,000 students make York a great location to buy a property to let. Properties cost in the region of £210,979 and have an average yield of 6.1%. The historic city is also awash with tourists coming to sample some of its famous tearooms and to view the Roman remains.
14 – Cheltenham
The town of Cheltenham is home to the University of Gloucestershire and two of its three campuses. There are over 9,000 students in attendance at the university and a 4-bedroom property in the area will set you back about £429,000, with a gross yield of roughly 4.56%.
15 – Liverpool
Average property prices in Liverpool are £91,175 and have a rental yield of 6.5%. The city’s 3 universities create a combined student population of 50,000. Liverpool has great transport links to Manchester and London, plenty of history and an excellent social scene.
16 – Bournemouth
Another seaside town ripe for investment is Bournemouth, where the average cost of a house is £172,914. Long term investments are ideal for this up-and-coming area where gross rental yields hit 6.23% in 2014.
Article Courtesy of: Patrick Smith, Housesimple