Written by Ray Clancy
Thursday, 29 October 2009 09:14 -
Buying property and renting it out to students is proving profitable for landlords in Scotland as demand is high and rents stable, according to letting agents.
Research from Lettingweb.com shows that demand from students is high and contrary to
popular opinion students generally make excellent tenants.
'The lettings market in Scotland has seen rental values decline somewhat during the first half of this year. High stock levels have forced landlords to reduce their expectations without the reward of securing a faster let. Demand for student flats, on the other hand, always seems to outstrip supply,' said Richard Matthews, marketing manager.
He explained that properties close to university campuses and near attractions such as night clubs and pubs are easy to let. 'In Glasgow, the highest demand for student flats is, as expected, in the city centre and West End. Generally students will aim to be as close to their campus as possible,' said Matthews.
Gone are the days when students were rowdy and got behind with their payments. 'As rents are more often than not now being guaranteed by parents, the standard of student flats nowadays is very high. The stereotype for students is mostly gone as they want to rent something of good quality,' added Matthews.
In Edinburgh all the student properties for the new academic year were rented out before the start of the summer. 'We could easily have let many, many more if we had them on our books. We don't even put a waiting list up for properties because the response is so immense every year. There are some students who will start to ask in January about properties for their next academic year as they are desperate to get a good home in a desirable location in the city,' said Colette Murphy, director at Braemore Property Management.
'We've seen rent falls across other parts of the rental market in recent months as there has been greater competition among landlords for tenants. However, student flats are definitely proving the exception to the rule, as these tenants are happy to pay a higher rent to secure a good property,' she added.
The company reckons that if you have a property in an area close to the university such asNewington, the Southside or Marchmont then it will prove popular with the student market. A three or four bedroom flat or house is renting for between £325 and £450 per double room per month depending on the quality of the property and its location.
Friday, October 30, 2009
Friday, September 25, 2009
Student accommodation tips for the novice
By Let and Stay (Pty) Ltd
So you have passed your matric exams, have been accepted to varsity and now need a place to stay. If you have not been accepted to a university dorm then you can make use of a student accommodation agency such as Let and Stay (Pty) Ltd to assist you in finding a suitable spot to lay your head.
It’s important to remember that you have a lot of campus activities in your first year so you need accommodation that is close to the university so that you can save time and effort in travelling between classes and activities. Accommodation that is walking distance from your campus will not only save you pot loads of money but also increase your available time to do your campus activities.
You have two private accommodation options to choose from;
• Commune / digs: You have your own room in a house shared by other students – you will commonly share a lounge and kitchen and sometimes a bathroom. You do not have to worry about trivial things like the garden and other maintenance, plumbing issues and so forth – your managing agent will take care of these issues. Your room will be semi furnished – you will have a bed, desk, chair, curtains, and cupboard. Some properties also offer WI-FI internet access and DSTV connections. Your house will be cleaned weekly and will offer secure parking for a car if required.
This option affords you the opportunity to stay with other students in a secure environment that is not as restrictive as a university dorm but still has its own house rules that you need to abide by.
• Cottage: You have your own unit that’s completely private. You could also share this cottage with a friend. You also don’t have to worry about maintenance related issues.
Other important information:
• Always deal with a reputable student letting agent that understands your budget and requirements. Your agent will present you with a professional lease agreement and offer you protection from unscrupulous landlords. Your agent will also ensure the standard and upkeep of the property.
• If you are under 21 then your parents will have to co-sign the lease agreement with you.
• Your lease will typically be for 1 year at a time.
• You want to stay within walking distance from campus – this saves time and money.
• Prices for a room in a digs start form R1900 – R3500. A cottage could cost you R2000 – R4500.
If you visit our website www.letandstay.co.za you will find more valuable information and tips on finding the perfect place to stay.
Good luck with the next phase of your lives.
So you have passed your matric exams, have been accepted to varsity and now need a place to stay. If you have not been accepted to a university dorm then you can make use of a student accommodation agency such as Let and Stay (Pty) Ltd to assist you in finding a suitable spot to lay your head.
It’s important to remember that you have a lot of campus activities in your first year so you need accommodation that is close to the university so that you can save time and effort in travelling between classes and activities. Accommodation that is walking distance from your campus will not only save you pot loads of money but also increase your available time to do your campus activities.
You have two private accommodation options to choose from;
• Commune / digs: You have your own room in a house shared by other students – you will commonly share a lounge and kitchen and sometimes a bathroom. You do not have to worry about trivial things like the garden and other maintenance, plumbing issues and so forth – your managing agent will take care of these issues. Your room will be semi furnished – you will have a bed, desk, chair, curtains, and cupboard. Some properties also offer WI-FI internet access and DSTV connections. Your house will be cleaned weekly and will offer secure parking for a car if required.
This option affords you the opportunity to stay with other students in a secure environment that is not as restrictive as a university dorm but still has its own house rules that you need to abide by.
• Cottage: You have your own unit that’s completely private. You could also share this cottage with a friend. You also don’t have to worry about maintenance related issues.
Other important information:
• Always deal with a reputable student letting agent that understands your budget and requirements. Your agent will present you with a professional lease agreement and offer you protection from unscrupulous landlords. Your agent will also ensure the standard and upkeep of the property.
• If you are under 21 then your parents will have to co-sign the lease agreement with you.
• Your lease will typically be for 1 year at a time.
• You want to stay within walking distance from campus – this saves time and money.
• Prices for a room in a digs start form R1900 – R3500. A cottage could cost you R2000 – R4500.
If you visit our website www.letandstay.co.za you will find more valuable information and tips on finding the perfect place to stay.
Good luck with the next phase of your lives.
Varsities run out of housing
MONAKO DIBETLE JOHANNESBURG, SOUTH AFRICA
Several universities are struggling to find sufficient residence accommodation for their students and are now conceding that the situation has reached crisis levels.
They are appealing to the Department of Higher Education for assistance, as they believe this problem affects students' academic performance.
South Africa has experienced a boom in higher education, with more than 74 0000 students now studying at universities.
Last year, former education minister Naledi Pandor told that R3,2-billion was earmarked for 2010/11 to 2011/12 for projects that will achieve national social and economic development goals. About 20% would be allocated to student housing.
The ministry said: "Inadequate student housing remains an obstacle to equity of access in higher education. Funding will support the creation of quality student housing, particularly at historically disadvantaged institutions in rural areas. Improved quality of student accommodation can help improve student success rates and eventual graduation rates."
While student housing projects are in the pipeline, a recent discussion forum comprising deans of students from universities in Gauteng, Limpopo and North West has highlighted that residence accommodation is "raising serious concerns".
Led by the Foundation of Tertiary Institutions of the Northern Metropolis (Fotim), the forum said universities need "support, advice and assistance in planning where students are going to live".
"We want universities to be very clear about student accommodation. We want the government to be aware of this challenge, which most universities seem to be facing," Fotim director Dr Zodwa Magwenzi told higher learning.
She said the high rate of student failures and increasing first-year dropout rates were worsened by the lack of student accommodation.
"It is thus important, especially for first-year students, to stay at residences in order to avoid this and for the purposes of proper orientation."
The forum indicated that students have had to find alternative places to live. This results in problems such as:
Students having to access private accommodation and becoming targets of crime;
"Slumlords" are renting out dilapidated buildings to "slumdog" students who pay exorbitant rent;
Landlords taking money from students and abandon the building, leaving students stranded without essential services; and
Long waiting lists causing students to hesitate and find alternative accommodation, resulting in them being stranded.
While the University of Limpopo denied that some of its students had been staying in converted water tanks, investigations by higher learning reveal that some students are subletting rooms at the University of Venda (Univen).
"Of course students sublet their rooms and there is no single room or double room housing the required number of students per room … there are always two or three more students in one room," said Univen SRC president Sylvester Motadi.
He said conditions at the recently built prefabricated student lodgings are "appalling", because the structures are weak and pose a safety hazard.
"It is difficult walking in those buildings without feeling scared," he said. However, students are confident the university leadership will address the matter.
Univen spokesperson Takalani Dzaga acknowledged that student housing had reached crisis levels but denied that students were sub-letting their residences, explaining that the university has an electronic control system that regulates access.
Dzaga said modular structures had been built to ease the accommodation burden as a short-term solution.
The university can accommodate only 2 036 students in its residences. This year it admitted an extra 2 266 students, bringing the total to 11 201.
University of the Western Cape spokesperson Luthando Tyhalibongo said the institution could accommodate only about 4 000 students at residences out of a total of 16 000. "We are in the process of increasing our capacity to meet the [high] demand for residences," he said.
South African Student Congress president Mawethu Rune said: "Institutions can't continue with this attitude of only being concerned with teaching and learning … they should also be concerned about the conditions in which students live as this impacts on student performance. There is a serious student accommodation problem in the country but students are not receiving the necessary support [from universities and government]."
The Department of Higher Education confirmed there is a severe shortage of student housing.
"The department will be implementing a new, larger student housing programme during the 2010 and 2011 academic years," Mfanafuthi Sithebe, a department spokesperson, said.
"This has to be seen in the context of the high capital costs involved in providing student housing on a university campus. For example, a standard residence with a capacity of 200 students in double rooms is expected to cost at least R30-million in 2010."
Source: Mail and Guardian Online
Web Address: http://www.mg.co.za/article/2009-09-23-varsities-run-out-of-housing
Several universities are struggling to find sufficient residence accommodation for their students and are now conceding that the situation has reached crisis levels.
They are appealing to the Department of Higher Education for assistance, as they believe this problem affects students' academic performance.
South Africa has experienced a boom in higher education, with more than 74 0000 students now studying at universities.
Last year, former education minister Naledi Pandor told that R3,2-billion was earmarked for 2010/11 to 2011/12 for projects that will achieve national social and economic development goals. About 20% would be allocated to student housing.
The ministry said: "Inadequate student housing remains an obstacle to equity of access in higher education. Funding will support the creation of quality student housing, particularly at historically disadvantaged institutions in rural areas. Improved quality of student accommodation can help improve student success rates and eventual graduation rates."
While student housing projects are in the pipeline, a recent discussion forum comprising deans of students from universities in Gauteng, Limpopo and North West has highlighted that residence accommodation is "raising serious concerns".
Led by the Foundation of Tertiary Institutions of the Northern Metropolis (Fotim), the forum said universities need "support, advice and assistance in planning where students are going to live".
"We want universities to be very clear about student accommodation. We want the government to be aware of this challenge, which most universities seem to be facing," Fotim director Dr Zodwa Magwenzi told higher learning.
She said the high rate of student failures and increasing first-year dropout rates were worsened by the lack of student accommodation.
"It is thus important, especially for first-year students, to stay at residences in order to avoid this and for the purposes of proper orientation."
The forum indicated that students have had to find alternative places to live. This results in problems such as:
Students having to access private accommodation and becoming targets of crime;
"Slumlords" are renting out dilapidated buildings to "slumdog" students who pay exorbitant rent;
Landlords taking money from students and abandon the building, leaving students stranded without essential services; and
Long waiting lists causing students to hesitate and find alternative accommodation, resulting in them being stranded.
While the University of Limpopo denied that some of its students had been staying in converted water tanks, investigations by higher learning reveal that some students are subletting rooms at the University of Venda (Univen).
"Of course students sublet their rooms and there is no single room or double room housing the required number of students per room … there are always two or three more students in one room," said Univen SRC president Sylvester Motadi.
He said conditions at the recently built prefabricated student lodgings are "appalling", because the structures are weak and pose a safety hazard.
"It is difficult walking in those buildings without feeling scared," he said. However, students are confident the university leadership will address the matter.
Univen spokesperson Takalani Dzaga acknowledged that student housing had reached crisis levels but denied that students were sub-letting their residences, explaining that the university has an electronic control system that regulates access.
Dzaga said modular structures had been built to ease the accommodation burden as a short-term solution.
The university can accommodate only 2 036 students in its residences. This year it admitted an extra 2 266 students, bringing the total to 11 201.
University of the Western Cape spokesperson Luthando Tyhalibongo said the institution could accommodate only about 4 000 students at residences out of a total of 16 000. "We are in the process of increasing our capacity to meet the [high] demand for residences," he said.
South African Student Congress president Mawethu Rune said: "Institutions can't continue with this attitude of only being concerned with teaching and learning … they should also be concerned about the conditions in which students live as this impacts on student performance. There is a serious student accommodation problem in the country but students are not receiving the necessary support [from universities and government]."
The Department of Higher Education confirmed there is a severe shortage of student housing.
"The department will be implementing a new, larger student housing programme during the 2010 and 2011 academic years," Mfanafuthi Sithebe, a department spokesperson, said.
"This has to be seen in the context of the high capital costs involved in providing student housing on a university campus. For example, a standard residence with a capacity of 200 students in double rooms is expected to cost at least R30-million in 2010."
Source: Mail and Guardian Online
Web Address: http://www.mg.co.za/article/2009-09-23-varsities-run-out-of-housing
Wednesday, September 16, 2009
Fake landlords, estate agents: Tenants beware
Tabloid Tuesday reporters
15 September 2009
Con artists steal house-hunters' deposits - and more.
This week in Tabloid Tuesday: South Africa's horrifying crime statistics haven't made property hunters and investors streetwise.
The case of the desperate landlord. A shrewd con artist will always tap into the big fears and greeds of the day. Take the panic about plummeting house prices and recessionary conditions: most people know that landlords are desperate people, right? And that they will offer their properties for low, low rentals to the first person who presents a cash deposit?
That certainly seems to be the thinking of Mischievous Melissa, a fraudster who has been successfully getting house-hunters to part with lump sum deposits for rental homes she doesn't own.
Table Talk, a popular freebie tabloid that circulates around Cape Town's Western Seaboard, reports this week on how Melissa has a dossier of cases building up against her at police stations in the Western Cape thanks to hoodwinking desperate home-seekers out of cash deposits.
Here's her apparent modus operandi:
· Step one. Look for a rental property available on the market.
· Step two. Advertise that property for a rental vastly below the market norm, on websites, in newspaper classified advertising sections and on shopping bulletin boards;
· Step three. Tell the droves of people who arrive to view the premises that she doesn't have the keys, but that they can look around the property and peer through the windows to get an idea of what's on offer;
· Step four. SMS eager tenants looking for a good deal, urging them pay their deposits fast;
· Step five. Move to another suburb and start again;
· Step six. Enlist others to help widen the scam.
Nicholas Walker, who is among the landlords who discovered a "fake ad" was placed in the Cape Argus, said a neighbour smelt a rat at his Monte Vista property. He told Walker he "saw lots of people coming to view the house, and they would all walk around the side and go through the gate to enter the back".
Commented Walker about the prospective tenants who have been losing money through this scam: "For R4 500, you must think that something is fishy. Rentals in the area range from R7 000 to R9 000. Why would you pay a deposit before seeing the house or making contact with the owner" Walker asked, adding that Melissa is "preying on people who are desperate".
Police spokesperson Captain Frederick van Wyk is reported as saying although "many people" have been conned, they are investigating "only" 10 cases where charges have been laid.
The good news for those hoodwinked is that the investigation, says Van Wyk, is "at a very critical and sensitive phase". That's detective speak for: "We have a good idea of who is running this scam and are about to make an arrest.
Thieving tenants. The shoe is often on the other foot. Tenants are often the perpetrators of crime and landlords the victims. Recent advice from TPN, an organisation that provides information services to landlords, highlights the perils of being a buy-to-let investor.
One of the first signs of trouble, warns Michelle Dickens, MD of TPN: "The tenant requires the property immediately, usually on a Saturday afternoon after banks are closed and wants to pay by cheque. The tenant signs a lease and says they will pay your rent in cash on the 1st, the landlord meets the tenant at the property to hand over keys and does an incoming inspection. The tenant has a ‘story' and promises to pay via EFT the next day. The landlord hands over the keys in trust and does not receive rent."
Whichever way you look at it, it seems like when things seem too financially easy, there's a catch.
Speaking of smoke ‘n mirrors. Investors who ploughed R300m into a property syndication scheme and creditors hoping to get some money back fast from the City Capital/Capital Investments set-up have been dealt an irritating blow. At the end of last week, syndication operators had a bunfight with liquidators, not over the millions tied up in property, but over the second-hand office furniture that together with a bakkie and trailer might at most fetch have fetched about R300 000-R400 000 last week on auction.
"In a last minute effort to stop the auctioning off of certain movable property, specifically office furniture, an urgent application was yesterday made to the Western Cape High Court by Dividend Commercial (Pty) Ltd against the liquidators of Capital Investments (Pty) Ltd (in liquidation). City Capital (also in provisional liquidation) effectively owns 15% of the Div-Vest group, of which Dividend Commercial is a part," said law firm Edward Nathan Sonnenbergs. The application was dismissed, and the furniture will be auctioned at a later date.
One wonders whether there's money hidden in a secret drawer, or stuffed in a chair cushion as, amid all that money being thrown at lawyers, no-one seems to have been actually using the furniture.
Monday, September 14, 2009
Should you pay for 'res' or buy student accommodation?
Students who choose to study away from home need accommodation, and at this time of the year that always raises the question for parents of whether they should plan to pay for ‘res’ or other rented space, or decide to buy their own student flat or house.
“Residence fees have increased in line with course costs and are now around R25 000 to R30 000 a year for a single room with meals during term-times. And the costs of staying in a student commune are roughly the same, with the average room rate being around R1200 a month and provision having to be made for meals and transport,“ says Berry Everitt, CEO of the Chas Everitt International property group.
“The accommodation outlay for a typical three-year degree is thus around R90 000 – an amount many parents feel could be better used to help buy a student flat or house on which they stand to make some return.”
For example, he says, purpose-built bachelor or studio flats for students have proliferated in recent years around many SA universities, and prices have shown a steady increase to around R500 000 on average, which at the current interest rates puts the annual bond repayment total at around R55 000, after payment of a R50 000 deposit.
“On top of this, parents will need to make provision for monthly sectional title levies and food costs, taking their three-year outlay to around R300 000. However with student numbers and demand for accommodation continuing to rise at most SA universities, they do stand to make a good profit on resale at the end of the study period.”
Writing in the Property Signposts newsletter, Everitt says another option for parents is to buy a bigger flat or a house where spare rooms can be let out to other students, with the rentals being used to offset the monthly home loan repayments while the property grows in value.
“This may seem like the best choice but here, too, there are additional factors to be taken into account such as maintenance costs in the case of freehold homes, the provision of kitchen equipment, furniture and cleaning services in a commune, and the fact that a student who lives further away from campus may need transport.
“In short, before making any decision, parents need to look carefully at the numbers and seriously consider other factors such as proximity to the university and maintenance of the property, preferably with the help of a seasoned estate agent who specialises in student accommodation.”
Article by: www.chaseveritt.co.zaww.ChasEveritt.co.za
“Residence fees have increased in line with course costs and are now around R25 000 to R30 000 a year for a single room with meals during term-times. And the costs of staying in a student commune are roughly the same, with the average room rate being around R1200 a month and provision having to be made for meals and transport,“ says Berry Everitt, CEO of the Chas Everitt International property group.
“The accommodation outlay for a typical three-year degree is thus around R90 000 – an amount many parents feel could be better used to help buy a student flat or house on which they stand to make some return.”
For example, he says, purpose-built bachelor or studio flats for students have proliferated in recent years around many SA universities, and prices have shown a steady increase to around R500 000 on average, which at the current interest rates puts the annual bond repayment total at around R55 000, after payment of a R50 000 deposit.
“On top of this, parents will need to make provision for monthly sectional title levies and food costs, taking their three-year outlay to around R300 000. However with student numbers and demand for accommodation continuing to rise at most SA universities, they do stand to make a good profit on resale at the end of the study period.”
Writing in the Property Signposts newsletter, Everitt says another option for parents is to buy a bigger flat or a house where spare rooms can be let out to other students, with the rentals being used to offset the monthly home loan repayments while the property grows in value.
“This may seem like the best choice but here, too, there are additional factors to be taken into account such as maintenance costs in the case of freehold homes, the provision of kitchen equipment, furniture and cleaning services in a commune, and the fact that a student who lives further away from campus may need transport.
“In short, before making any decision, parents need to look carefully at the numbers and seriously consider other factors such as proximity to the university and maintenance of the property, preferably with the help of a seasoned estate agent who specialises in student accommodation.”
Article by: www.chaseveritt.co.zaww.ChasEveritt.co.za
Monday, September 7, 2009
Students warned of fake landlords
A Londonderry father has warned students looking for accommodation for the new term to beware of bogus landlords advertising on the internet.
The man, who wanted to remain anonymous, said his son paid a deposit to a man who claimed to have a house for rent in south Belfast last year.
He was among a group of students who lost hundreds of pounds in the scam.
The National Union of Students said there has been a rise in the number of such cases.
The students' parents contacted Foyle MLA Martina Anderson after they realised they had been caught up in the rental scam.
The Sinn Fein representative said the families had paid a deposit of almost £800.
Unanswered calls
She added: "They spent weeks trying to get paperwork and keys, both of which never materialised.
"The owner never answered their calls, the contact ran cold and they lost all their money."
She urged those seeking student accommodation to exercise caution.
"For many of those students it will be the first time they have lived outside the family home and looking for accommodation can be a daunting task particularly in a new area.
"I would appeal to students and their parents to go through well established letting agencies and check the track record of private landlords who advertise on the internet before they sign any tenancy agreements or hand over large deposits."
Friday, August 28, 2009
Should I be a student landlord? UK
Posted by Catherine Deshayes on Wednesday, August 19, 2009
Many large portfolio landlords have started as student landlords letting their property to hoards of marauding students. The question for many parents of students looking to go to university this year or other property investors or landlords is should I join the ranks of student landlords?
Growing student letting market
There is no doubt that the student letting market continues to buck the trend in other areas of the economy. The resulting down turn has resulted in record numbers of students applying to enter higher education this year.
The latest figures show that application for degree course are up by 57,000 on last year as the economic downturn results in many students putting off work or ‘upskilling' in an attempt to avoid the dole cue.
According to Knight Frank the UK student population has grown consistently over the last 10 years. Total student numbers have grown from 1.8 million in 1997 to 2.5 million in 2007. Savills expect this to hit three million full and part time students by 2014.
Growth has been driven in the main by domestic UK undergraduate demand. However, there is a trend to rising numbers of foreign student, with participation of overseas students at UK universities rising 67 per cent over the past decade.
Knight Frank research shows that in 1997 they accounted for 11 per cent (international students) and 21 per cent (postgraduates) of all students; by 2007 these figures had increased to 15 per cent and 24 per cent respectively.
Both international students and postgraduates are more likely to opt for purpose built private student housing rather than shared houses. Foreign student numbers are expected to grow from 15 per cent of all students in 2008 to 21 per cent by 2018.
Knight Frank in their Report produced this year estimated that London alone requires an additional 100,000 student bedspaces.
Student lettings niche letting market
Letting to students is a very niche part of the private lettings market requiring particular skills and an approach. It's more complex and potentially involves the landlord complying with a greater deal of regulation than a standard buy-to-let.
This is because many student lets will be classed as a house in multiple occupation (HMO). Landlords letting certain types of HMOs are now required to be licensed by their local authority. In order to obtain an HMO licence landlords will have to meet certain fire standards and accommodation standards that can be expensive to comply with. For example this can often involve having a newly installed fire alarm system and fire escape costing tens of thousands and also potentially taking value of the property because of it would then be no longer attractive to the owner occupier market.
Therefore for many first time landlords they should avoid investing in a property that is a potential HMO. The easiest way around this is to ensure that they only let their property to 4 or less student tenants as a rental property can only be classified as a HMO if let to 5 or more tenants.
In addition, student lets require a greater amount of supervision and management input. This is because student properties have a greater turnover of tenants than many buy-to-let properties occupied by professional tenants.
In addition many student lets will be required to be furnished. The level of furnishing is often specified by the university and landlords will need to comply with standards set out by the student accommodation office in order to be featured on the universities accommodation list circulated to many students looking for accommodation.
Students can make good tenants:
A student landlord can fit more student tenants into a property. A 3 bed house will frequently accommodate 4 sharers - and that's without letting the cupboard! This is more intensive than a let to a single tenant or even a house of professional sharers which can have a potential benefit on the investment yields.
Student tenants aren't quite as fussy. Students particularly undergraduates have tended not to be as fussy as professional tenants. These type of tenats are more prepared to put up with slightly outdated kitchens and colourful bathroom suites than design conscious professional tenants.
However, landlords shouldn't be complacent; with the advent of more and more private halls standards are rising and mature and foreign students often demand professional levels of accommodation.Student tenants sometime pay rent in advance.
Some student tenants or more accurately their parents will often pay upfront for each semester or term. This is handy for a landlord as they have the rent in advance with which to pay any mortgage or other costs.
Student tenants are bright. This in theory makes dealing with them and sorting out problems easier. Catherine Bancroft-Rimmer, author of The Landlord's Guide to Student Letting comments "You do get exceptions," "but once you've explained why you need them to do something they are usually quite willing to go along with it." From my experience there is nothing worse than trying to resolve a problem with a thick tenant. The phrase "like pulling teeth" comes to mind.
Student rental accommodation supply
There is no doubt that in many areas supply of rental accommodation by student landlords has failed to keep up with demand. This is especially true in London where a recent report by Knight Frank highlighted a shortfall of 100,000 bedspaces in London alone. However, like many aspects of buy-to-let investment the fundamentals of any market are essentially local.
Therefore a prospective student landlord should ensure that they do their own local research by talking to local rental agents and University Accommodation Offices before factoring in their expected rents to their investment calculations.
The competition amongst student landlords renting to students in some areas is a very strong. Some areas are already oversupplied according to Simon Thompson Director of Accommodation for Students.
"Leeds is quite overpopulated with student accommodation, as are the Fallowfield and Withington areas of Manchester."
Universities and increasingly private developers are constructing purpose built halls of residences. These aim for the top end of the market but none the less it is worth a landlord talking to the local planners to find out what is in the pipeline.
Student rent levels
The strong demand for student lettings and the shortage of supply has resulted in rents growing 10per cent in London where the shortage is particularly acute as London is the premiere centre for student accommodation in Europe with over 40 universities. In the rest of the UK rent level growth was less strong growing by only 8 per cent but still outpacing the rest of the residential investment market where rents actually fell by almost 2 per cent over the last year according to the Rentindex.
The latest figures on student rents released by accommodationforstudents.com, the UK's No 1 student accommodation website, reveal that the average UK weekly student rent continues to rise. At £62.40, their figure is up 1.5 per cent on last year and 19 per cent on the comparable figure five years ago. AFS figures are based on rents from over 51,000 properties across 75 cities in the UK and includes figures from purpose built student accommodation and private landlords.
The ideal type of property for a student landlord
Student tenants generally prefer to go into Halls for the first year after which they then look for accommodation in groups of 4 or 5. Our research shows that different student groups have varying accommodation requirements.
Post graduates for instance frequently prioritise a peaceful working environment and their demands are very similar to that of professional renters. Undergraduates are more likely to request accommodation located close to entertainment facilities and town centres and are more willing to live in larger shared properties.Location is often a key factor. Students like to be near each other. Chris Horne Editor of expert landlord website Property Hawk says, "If you can find out where the ‘cool' bars and places to hang out are; then a property close by will definitely have a marketing advantage. Essential is that your property has good access by public transport to the University campuses as well as the night life and basic shops and services. Not all students have cars!"A three bedroom property is probably ideal. This is because with a little bit of work, it should be possible to convert one of the ground floor rooms to an additional bedroom thereby allowing you as the landlord to accommodate 4 students. If you provide accommodation for 5 or more students, then you will very likely have to obtain a licence for your property as a House In Multiple Occupation (HMO).
This in itself is not a disaster in that it will probably only cost a couple of hundred pounds from the local authority. However, what could be more difficult is that in order to obtain the licence the Local Authority may insist on certain minimum standards in the property. Examples of this are sinks in every bedroom along with other expensive fire safety measures.
These works will not only be costly but potentially they will detract from the attraction of your property to the owner occupation market when you come to sell. To avoid this most student landlords are best advised at looking to keep the maximum number of student renters to 4. The exception to this might be where a landlord was looking at making it into a more involved commercial undertaking in which case buying an already licensed HMO would probably be cheaper and make more sense.Victorian terraced properties often provide ideal accommodation for a student landlord because of the generous room sizes. Large spacious rooms are particularly appealing to students as these are often more than just a place to sleep. In theory they will be places of study and also their private space to retreat to when all the partying and communal living gets too much! Landlords should therefore look for properties with 3 generous double rooms and one living room that can be converted to this.
Insuring your student rental property
Insurance is also an issue. Finding the right landlord insurance is essential as not all insurance companies are keen on student tenants and they may impose higher excesses or charge higher premiums where students are involved.
It is absolutely essential to ensure that a landlord insurance broker is fully aware of the position if you let to students. This is because many insurers consider that the type of tenant to be a "material fact". This means that if there is a claim and you have not disclosed this, they can quite legitimately seek to repudiate a claim.
Written by www.propertyhawk.co.uk
Many large portfolio landlords have started as student landlords letting their property to hoards of marauding students. The question for many parents of students looking to go to university this year or other property investors or landlords is should I join the ranks of student landlords?
Growing student letting market
There is no doubt that the student letting market continues to buck the trend in other areas of the economy. The resulting down turn has resulted in record numbers of students applying to enter higher education this year.
The latest figures show that application for degree course are up by 57,000 on last year as the economic downturn results in many students putting off work or ‘upskilling' in an attempt to avoid the dole cue.
According to Knight Frank the UK student population has grown consistently over the last 10 years. Total student numbers have grown from 1.8 million in 1997 to 2.5 million in 2007. Savills expect this to hit three million full and part time students by 2014.
Growth has been driven in the main by domestic UK undergraduate demand. However, there is a trend to rising numbers of foreign student, with participation of overseas students at UK universities rising 67 per cent over the past decade.
Knight Frank research shows that in 1997 they accounted for 11 per cent (international students) and 21 per cent (postgraduates) of all students; by 2007 these figures had increased to 15 per cent and 24 per cent respectively.
Both international students and postgraduates are more likely to opt for purpose built private student housing rather than shared houses. Foreign student numbers are expected to grow from 15 per cent of all students in 2008 to 21 per cent by 2018.
Knight Frank in their Report produced this year estimated that London alone requires an additional 100,000 student bedspaces.
Student lettings niche letting market
Letting to students is a very niche part of the private lettings market requiring particular skills and an approach. It's more complex and potentially involves the landlord complying with a greater deal of regulation than a standard buy-to-let.
This is because many student lets will be classed as a house in multiple occupation (HMO). Landlords letting certain types of HMOs are now required to be licensed by their local authority. In order to obtain an HMO licence landlords will have to meet certain fire standards and accommodation standards that can be expensive to comply with. For example this can often involve having a newly installed fire alarm system and fire escape costing tens of thousands and also potentially taking value of the property because of it would then be no longer attractive to the owner occupier market.
Therefore for many first time landlords they should avoid investing in a property that is a potential HMO. The easiest way around this is to ensure that they only let their property to 4 or less student tenants as a rental property can only be classified as a HMO if let to 5 or more tenants.
In addition, student lets require a greater amount of supervision and management input. This is because student properties have a greater turnover of tenants than many buy-to-let properties occupied by professional tenants.
In addition many student lets will be required to be furnished. The level of furnishing is often specified by the university and landlords will need to comply with standards set out by the student accommodation office in order to be featured on the universities accommodation list circulated to many students looking for accommodation.
Students can make good tenants:
A student landlord can fit more student tenants into a property. A 3 bed house will frequently accommodate 4 sharers - and that's without letting the cupboard! This is more intensive than a let to a single tenant or even a house of professional sharers which can have a potential benefit on the investment yields.
Student tenants aren't quite as fussy. Students particularly undergraduates have tended not to be as fussy as professional tenants. These type of tenats are more prepared to put up with slightly outdated kitchens and colourful bathroom suites than design conscious professional tenants.
However, landlords shouldn't be complacent; with the advent of more and more private halls standards are rising and mature and foreign students often demand professional levels of accommodation.Student tenants sometime pay rent in advance.
Some student tenants or more accurately their parents will often pay upfront for each semester or term. This is handy for a landlord as they have the rent in advance with which to pay any mortgage or other costs.
Student tenants are bright. This in theory makes dealing with them and sorting out problems easier. Catherine Bancroft-Rimmer, author of The Landlord's Guide to Student Letting comments "You do get exceptions," "but once you've explained why you need them to do something they are usually quite willing to go along with it." From my experience there is nothing worse than trying to resolve a problem with a thick tenant. The phrase "like pulling teeth" comes to mind.
Student rental accommodation supply
There is no doubt that in many areas supply of rental accommodation by student landlords has failed to keep up with demand. This is especially true in London where a recent report by Knight Frank highlighted a shortfall of 100,000 bedspaces in London alone. However, like many aspects of buy-to-let investment the fundamentals of any market are essentially local.
Therefore a prospective student landlord should ensure that they do their own local research by talking to local rental agents and University Accommodation Offices before factoring in their expected rents to their investment calculations.
The competition amongst student landlords renting to students in some areas is a very strong. Some areas are already oversupplied according to Simon Thompson Director of Accommodation for Students.
"Leeds is quite overpopulated with student accommodation, as are the Fallowfield and Withington areas of Manchester."
Universities and increasingly private developers are constructing purpose built halls of residences. These aim for the top end of the market but none the less it is worth a landlord talking to the local planners to find out what is in the pipeline.
Student rent levels
The strong demand for student lettings and the shortage of supply has resulted in rents growing 10per cent in London where the shortage is particularly acute as London is the premiere centre for student accommodation in Europe with over 40 universities. In the rest of the UK rent level growth was less strong growing by only 8 per cent but still outpacing the rest of the residential investment market where rents actually fell by almost 2 per cent over the last year according to the Rentindex.
The latest figures on student rents released by accommodationforstudents.com, the UK's No 1 student accommodation website, reveal that the average UK weekly student rent continues to rise. At £62.40, their figure is up 1.5 per cent on last year and 19 per cent on the comparable figure five years ago. AFS figures are based on rents from over 51,000 properties across 75 cities in the UK and includes figures from purpose built student accommodation and private landlords.
The ideal type of property for a student landlord
Student tenants generally prefer to go into Halls for the first year after which they then look for accommodation in groups of 4 or 5. Our research shows that different student groups have varying accommodation requirements.
Post graduates for instance frequently prioritise a peaceful working environment and their demands are very similar to that of professional renters. Undergraduates are more likely to request accommodation located close to entertainment facilities and town centres and are more willing to live in larger shared properties.Location is often a key factor. Students like to be near each other. Chris Horne Editor of expert landlord website Property Hawk says, "If you can find out where the ‘cool' bars and places to hang out are; then a property close by will definitely have a marketing advantage. Essential is that your property has good access by public transport to the University campuses as well as the night life and basic shops and services. Not all students have cars!"A three bedroom property is probably ideal. This is because with a little bit of work, it should be possible to convert one of the ground floor rooms to an additional bedroom thereby allowing you as the landlord to accommodate 4 students. If you provide accommodation for 5 or more students, then you will very likely have to obtain a licence for your property as a House In Multiple Occupation (HMO).
This in itself is not a disaster in that it will probably only cost a couple of hundred pounds from the local authority. However, what could be more difficult is that in order to obtain the licence the Local Authority may insist on certain minimum standards in the property. Examples of this are sinks in every bedroom along with other expensive fire safety measures.
These works will not only be costly but potentially they will detract from the attraction of your property to the owner occupation market when you come to sell. To avoid this most student landlords are best advised at looking to keep the maximum number of student renters to 4. The exception to this might be where a landlord was looking at making it into a more involved commercial undertaking in which case buying an already licensed HMO would probably be cheaper and make more sense.Victorian terraced properties often provide ideal accommodation for a student landlord because of the generous room sizes. Large spacious rooms are particularly appealing to students as these are often more than just a place to sleep. In theory they will be places of study and also their private space to retreat to when all the partying and communal living gets too much! Landlords should therefore look for properties with 3 generous double rooms and one living room that can be converted to this.
Insuring your student rental property
Insurance is also an issue. Finding the right landlord insurance is essential as not all insurance companies are keen on student tenants and they may impose higher excesses or charge higher premiums where students are involved.
It is absolutely essential to ensure that a landlord insurance broker is fully aware of the position if you let to students. This is because many insurers consider that the type of tenant to be a "material fact". This means that if there is a claim and you have not disclosed this, they can quite legitimately seek to repudiate a claim.
Written by www.propertyhawk.co.uk
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