Buying a property to let is still a good investment, even with the changes earlier this year to stamp duty. Pick the right location and you can find a ready supply of eager tenants and make a sizeable, long-term profit in the process. In Newcastle, there are several reasons why you might want to focus on student properties in particular, not least because it’s now one of the prime higher educational hubs in the country.
A Big Student Population
Firstly, Newcastle has a large student population, some 53,000 at any one time, many of who are looking to rent a property in the area. The city has two world class universities:
- Newcastle University: Located in the centre of the city, the university has a population of 25,000 students and they all need somewhere to live. Rated as one of the top higher educational establishments in the country, Newcastle University attracts high quality students from across the world.
- Northumbria University: Also based in the heart of the city, the university offers a range of undergraduate and postgraduate study. With great facilities and exceptional teaching, it is another leading UK university with a student population of 27,000.
Supply Isn’t Meeting Demand
With so many students looking for accommodation in Newcastle, it’s understandable that supply isn’t quite keeping up with demand. The city has only 10,000 purpose built rooms for student accommodation. That means there’s a demand that needs to be filled and rental prices for landlords are highly competitive compared to the rest of the country.
It’s not just local students that need accommodation. Investment by both universities has seen an increase in the international student population. Combine this with a city that is definitely on the up and has plenty to attract young people including bars, restaurants and theatres, and you have a thriving location with lots of potential. The university population is on the increase and the city desperately needs new purpose built student accommodation that fits the bill.
There several other benefits to renting a property to students, apart from the large, available population in the Newcastle area.
- Students tend to let in advance and want to find somewhere to stay before they take up their studies, so that you can easily plan for the future.
- Universities deliver a dependable market with a steady supply of students who come, complete their course and then leave.
- You have a wider pool of potential tenants to choose from which means you can pick and choose more, ensuring you get the people who are going to pay the rent and maintain your property.
- You can choose to let a whole house or work on a room by room basis depending on your property.
- While students aren’t working, most letting agents will arrange for a guarantor such as a parent so that your rental income is protected.
For buy to let landlords who have the right property, focusing on student lets, in a city that has such a big market, can deliver a reliable and healthy revenue stream. Certainly, Newcastle, with its two universities, is one of the best places to operate.