Buy-to-Let Investors Target UK's Postgraduate Students

A hike in the number post-graduates in the UK is creating lucrative opportunities for buy-to-let investors.

Investment specialist Assetz said, using figures from GVA commercial property management, the post-graduate student population in Britain has increased by 13.4% between 2007 and 2012 – nearly half (45%) are now international (non-EU) and 12% are from the EU.

The company said the result of this "rapid growth" is even more demand on a "seriously under supplied" bespoke post-grad accommodation marketplace.

"Undergraduate student hall of residence accommodation has long been a sound buy-to-let investment opportunity, offering excellent yields, but the lucrative market in high quality post-graduate accommodation is only just starting to materialise," said Stuart Law, chief executive officer of Assetz.

He added: "Many students are continuing to study after their undergraduate degree due to the current competition in the UK jobs market and overseas students are drawn to the UK for its excellent standard of university education."

Investors looking to diversify or increase their buy-to-let portfolios are being attracted by net yields of up to 8% for post-graduate accommodation in some of the strongest post-grad universities Including De Montfort University in Leicester and Glasgow University.

China, India and Nigeria top the list of international post-grad students with Germany, Republic of Ireland and France supplying students in the greatest numbers within the EU.

In addition, the most common subjects studied are Business Studies (36%), Engineering (32%) and Social Studies (17%), according to the UK Council for International Student Affairs.

"Our experience is that post-grads have a clear preference for their own space – self-contained hotel-style studio apartments which facilitate independent living in a well-managed building that permits peaceful study," Law said.