February 10th, 2017
Northern cities are emerging as the highest-yielding locations for student property investment.
The North-South divide still applies when it comes to student buy-to-let investments as student property demand increases. Liverpool boasts one of the largest universities in the UK with a student population of approximately 70,000, an increase of 16% since 2016. While a large number of students isn’t necessarily a silver bullet for investment returns, high student demand and low student property supply, coupled with an average rental yield of 5.16%, Liverpool is considered one of the best UK buy-to-let locations and is attracting thousands of landlords.
Liverpool is a booming city which has undergone several regeneration schemes, with more than £1 billion in projects, some focusing on Liverpool docks and the Liverpool Central Library, resulting in an increase of student property prices in the area. As a result, there are many areas that are now considered suitable for student property investment and the city has attracted more than £5 billion in property investments, infrastructures and services. Several streets, such as London Road, were once industrial streets and are now being overwhelmed by student property, becoming a more popular area to live in amongst students. This is no surprise as the city’s technology and digital creativity sectors are rapidly expanding, and are one of the fastest growing sectors in the UK.
Being home to the Liverpool Everyman & Playhouse, Tate Liverpool and The Walker Art Gallery, the city is filled with culture. Liverpool is also known to be affordable in terms of living, housing and entertainment, which many students consider important factors when choosing a student city. Areas such as the city centre, Allerton and Fox Street, are seeing a great deal of interest, since the £200m investment on the New Chinatown development and the £335m investment on the Royal Liverpool Hospital took place, leaving investors in student buy-to-let with a handful of unique selling points.
An article by Property Reporter indicated that there had been an increase of 37% in demand for shared student properties in the city, during the last 18 months. It is also estimated that 60% of students in Liverpool require accommodation, proving once more that the student property supply cannot satiate the city’s steep rise in demand for student housing. New modern purpose-built student developments are being constructed to meet those demands. However, the key to investing in Liverpool student property is not to focus on the sheer quantity, but rather to invest in both good quality and high-yielding student properties.
A further driver for the city’s appeal to buy-to-let investors is the recent £556 million boost for the Northern Powerhouse announced by Theresa May. Liverpool’s great transport links and its 15-minute connectivity between the city centre and the airport is extremely appealing to students. Along with the investment boost on the HS2 rail service, which moves it a step closer, Linking Liverpool has stated that a £15 billion boost to the city region economy in addition to 20,000 new jobs will be created once it is ready. These major developments, along with the resurgence of the rest of the city, will attract thousands of students as they are more inclined to move from the countryside to 21st century urban cities.
Liverpool’s massive student population coupled with low house prices, high rental yields and the city’s resurgence, indicates that the city will remain as a hotspot in the UK’s buy-to-let market. So don’t miss the chance and get your student property investment in Liverpool now.