Is Student Housing Still A Good Investment Post-Brexit?

While economic analysts seem to be reneging on their original prophesies of doom for the UK economy, many buy-to-let investors will want to know if student property is still a good investment. The answer to this has less to do with what may or may not transpire from the UK’s negotiations with the EU and more to do with the underlying fundamentals that are underpinning the student property market.

One of these essential pillars has been the increase in student numbers not just domestically, but also from overseas. Universities all over the UK have been on major recruitment drives in China and India encouraging students to travel thousands of miles to gain a world class education and open up career opportunities.

International students are not just migrating to the UK, however. Other countries are also looking to attract students to their universities with numbers set to double globally by 2025. The UK currently sits comfortably in second place behind the US as the most popular destination for international students.

Britain’s town’s and cities are currently being transformed by growing student populations. According to figures released by UCAS, 532,300 people enrolled on higher education courses in 2015 which was a 3.1% increase on figures released in 2014. It was also the highest number ever recorded.

So let’s return to Brexit. What sort of an impact will Brexit have on student numbers and Universities. Are we likely to see less students enrolling? Will International students be more likely to turn to other countries?

These questions are at the heart of current uncertainty among some investors and rightly so. Dig deeper into the statistics, however, and you will find that EU students make up just 7% of the total student population in the UK, which is tiny.

Even if every EU student ends up being barred from studying in the UK, and no sane, sensible person would predict that happening, the impact would hardly be felt. The government has already stated that funding for EU students will be protected for the time being.

The biggest concern for investors should be whether or not there is a big enough market for student property. According to one major student property developer there is. An estimated 91% of first year students don’t have access to purpose built accommodation when they finish their first year.

This explains why so many purpose built developments are being constructed around the country to satisfy this demand. Currently students are left to find whatever suitable housing they can find close to university. This is a difficult task in city centres where available property of a high standard is difficult to find.

The reality for most students today is that while opportunities to study have never been greater, accommodation has failed to keep pace with the rapid expansion of universities creating the opportunities investors now have to capitalise on demand.

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