A shortfall of student beds in university halls of residence and student pods (PBSA) in Liverpool has led to a surge in demand for high quality shared student accommodation, up by 35% over the last 12 months, according to The Mistoria Group, specialists in high yielding investment property in the North West.
Demand for shared student accommodation is growing due to rising numbers of students attending the three universities in Liverpool. Last year, there were 60,000 students studying in Liverpool, up 20% on the previous year and it is expected the numbers will rise again this year. It is estimated that 60% of these students require accommodation.
Many universities don’t have sufficient accommodation to meet demand from first year students who usually live in the university’s halls of residence, creating demand for privately owned accommodation. According to Student Accommodation Tracker, only 28% of student accommodation currently meets rising expectations.
Mish Liyanage, Managing Director of The Mistoria Group comments: “There is a very real shortage of quality student accommodation in Liverpool and demand is consistently outstripping supply. The number of student rooms has swelled over the last five years, but their still remains a shortfall.
We have seen a surge in students looking for high quality, HMO accommodation with close proximity to the universities and occupancy across our student accommodation is at 98%. “Shared student accommodation in Liverpool gives investors excellent yields. There are many areas of Liverpool that are ideal for student property investment such as Kensington, Wavertree, Toxteth, Kensington Fields.
Investors can acquire a high quality, three bed HMOs which will house students from £120,000 onwards. An average room in an HMO can be rented for £85 per week including bills, but ensuites can be high as £110 per week. The return on investment is very attractive too, with 13% (8% cash rental and 5% capital growth).
Student property is the fastest growing sector of the market, giving investors strong returns that are well ahead of standard BTL. The growing numbers of student tenants in Liverpool is driving demand for quality accommodation in the city and this is likely to be a long term trend.
Liverpool is the UK’s top buy-to-let hotspot, delivering investors average rental yields of 8%, once mortgage costs are taken into account. As housing and mortgage costs have the biggest influence on yield, Liverpool takes the top spot, as it has a combination of low average house prices and strong rents.”