The provision of student accommodation in the UK will continue to grow through 2018 after a record-breaking 2017, says one real estate firm.
Cushman & Wakefield has carried out research that reveals 30,000 bed spaces were provided last year to set a new record and opportunities for buy to let investors are also continuing to grow.
Their findings reveal that the number of beds has doubled since 2014 to reach 602,000.
Rents have also risen by 2.9% over the last two academic years.
The best rent increases for landlords were seen in Manchester, which has the largest student population outside of the capital, where rents for a studio increased by 5%.
Student properties with en-suite facilities
For those student properties with en-suite facilities, rents in Bristol and Birmingham grew by 4%, followed by Manchester, Nottingham and Edinburgh where rents rose by 3%.
However, the most expensive en-suite rents are found in London where students are paying an average of £185 every week. In Manchester it is £142 while the cheapest is found in Sheffield where students are paying £120 per week.
The real estate firm says that the supply of new student development is being dominated by the private sector who delivered 87% of all the new beds for the current academic year.
Student accommodation continues to flourish
Cushman & Wakefield's advisory associate, David Feeney, said: “Despite initial concerns over the increasing student tuition fees and the European Union referendum, it's encouraging that student accommodation continues to flourish.”
He warned that there's now a risk of over-supply, particularly for student studios being developed with the provision driven by higher rents rather than from student demand.
Mr Feeney added: “There's an opportunity for developers to meet demands for affordable accommodation and provide more en-suite or standard rooms for students.”
Tighter regulations haven't deterred portfolio landlords
Meanwhile, tighter financial regulations have not deterred landlords with a portfolio of rental properties, according to one buy to let lender.
Accord says that 32% of BTL applications since September have been from portfolio landlords.
That's when the Prudential Regulation Authority revealed its new rules that force lenders to scrutinise potential borrowers with four or more rental properties.
Accord’s commercial manager, Chris Maggs, said: “We've seen demand for BTL mortgages from first-time and experienced landlords increase.”
He said that the lender has adapted its mortgage offerings to meet the market’s changing needs with landlords adapting to ensure that their business can withstand any potential future changes.
