x
By using this website, you agree to our use of cookies to enhance your experience.
STAY CONNECTED!
    
newsletter-button

TODAY'S OTHER NEWS

Top universities for buy-to-let revealed

With the academic year set to get underway, thousands of students are busily moving into flats and rented homes in towns and cities around the UK, which is good news for landlords, many of which were concerned about the potential impact of the coronavirus pandemic. 

The Covid-19 crisis has changed the way we all live and the long-term implications are as yet unclear. Some universities have switched to teaching online, but it would appear that many still want the student lifestyle or to do the online learning with their peers.

Landlords can earn attractive returns when buying property near a university, but only if they are shrewd about where they purchase.

A combination of cheap property prices and high demand for rental accommodation in student towns and cities mean some landlords are earning healthy returns annually, although this latest study by lettings management platform, Howsy, suggests that on average, university rental yields sit at 4.4% across the UK.

Howsy looked at the top 50 universities across the UK and the current rental yields available in the immediate vicinity of each campus.

The study found that in terms of the best buy-to-let investment at present, the University of Dundee ranks number one, with rental yields surrounding the university’s campus in the DD1 postcode as high as 7.2% at the moment. 

Scottish universities account for the top three best buy-to-let uni campuses, according to the research.

The University of Aberdeen ranks second with an average rental yield in the AB24 postcode coming in at 6.8%, while the University of Strathclyde and the G1 postcode rank third with an average rental yield of 6.6%.

Outside of Scotland, the University of Leicester ranks as the best buy-to-let option in England, with a current average yield of 6.6% in the LE1 postcode.

Birmingham’s Aston University also ranks high (6.5%) along with the University of Leeds (6.41%), Nottingham Trent University (6.4%), Newcastle University (6.3%) and the University of Liverpool (6.1%).

While Cardiff University just makes the top ten with a current yield of 5.9% in the CF10 postcode, it is the best buy-to-let university option for landlords looking to invest in Wales.

Founder and CEO of Howsy, Calum Brannan, said: “Many students will be searching for accommodation now that they know where they stand with their results and this huge influx of demand is very positive news for buy-to-let landlords in uni towns across the UK.

“Of course, student tenants can have their downfalls, but so can any tenant in the rental space and the pros far outweigh the cons in terms of the carousel of consistent demand and income that they supply.

“With many of the top universities not only attracting the best students but also providing rental yields way above the UK average, a university buy-to-let could be the key to a profitable investment in what are otherwise tough times for landlords at present.”  

University

Location

Top 50 Rank

Outcode

Average house price

Average Rent pm

Average Rental Yield (%)

University of Dundee

Dundee

31

DD1

£146,000

£876

7.2%

University of Aberdeen

Aberdeen

26

AB24

£101,035

£576

6.8%

University of Strathclyde

Glasgow

36

G1

£160,147

£883

6.62%

University of Leicester

Leicester

38

LE1

£121,517

£664

6.56%

Aston University, Birmingham

Birmingham

43

B4

£145,640

£793

6.5%

University of Leeds

Leeds

16

LS2

£138,775

£741

6.41%

Nottingham Trent University

Nottingham

46

NG1

£160,099

£852

6.39%

Newcastle University

Newcastle upon Tyne

23

NE1

£154,535

£816

6.3%

University of Liverpool

Liverpool

33

L3

£143,576

£730

6.1%

Cardiff University

Cardiff

30

CF10

£172,917

£843

5.9%

University of Southampton

Southampton

18

SO17

£222,839

£1,007

5.4%

Queen's University Belfast

Belfast

27

BT7

£187,801

£825

5.3%

University of Nottingham

Nottingham

21

NG7

£166,848

£718

5.2%

University of Manchester

Manchester

17

M13

£212,944

£915

5.2%

University of Edinburgh

Edinburgh

15

EH8

£235,924

£994

5.1%

University of Warwick

Coventry

11

CV4

£257,287

£1,068

5.0%

Lancaster University

Lancaster

8

LA1

£160,721

£632

4.7%

University of Glasgow

Glasgow

19

G12

£287,762

£1,059

4.4%

University of Surrey

Guildford, Surrey

34

GU2

£452,347

£1,664

4.4%

University of Kent

Canterbury

47

CT2

£316,166

£1,163

4.4%

University of East Anglia UEA

Norwich

25

NR4

£314,704

£1,142

4.4%

University of Essex

Colchester

41

CO4

£280,313

£987

4.2%

University of Birmingham

Birmingham

13

B15

£242,675

£834

4.1%

University of Sheffield

Sheffield

28

S10

£253,392

£865

4.1%

University of St Andrews

St Andrews, Fife

3

KY16

£369,814

£1,248

4.0%

Heriot-Watt University

Edinburgh

29

EH14

£271,789

£891

3.9%

University of Stirling

Stirling

45

FK9

£276,179

£895

3.9%

University of Sussex

Brighton

40

BN1

£405,533

£1,305

3.9%

University of Cambridge

Cambridge

1

CB2

£483,588

£1,541

3.8%

Swansea University

Swansea

32

SA2

£231,500

£730

3.8%

University of Lincoln

Lincoln

50

LN6

£224,959

£689

3.7%

University of York

York

22

YO10

£280,366

£855

3.7%

Durham University

Durham

7

DH1

£224,494

£683

3.7%

Queen Mary University of London

Tower Hamlets (London Borough)

35

E1

£603,459

£1,829

3.6%

Arts University Bournemouth

Bournemouth

48

BH12

£292,209

£876

3.6%

University of Bath

Bath

9

BA2

£402,848

£1,188

3.5%

University of Oxford

Oxford

2

OX1

£486,921

£1,425

3.5%

University of Exeter

Exeter

12

EX4

£277,640

£800

3.5%

Royal Holloway, University of London

Egham

24

TW20

£469,326

£1,341

3.4%

Harper Adams University

Newport, Shropshire

42

TF10

£280,200

£787

3.4%

University of Reading

Reading

39

RG6

£387,577

£1,085

3.4%

Loughborough University

Loughborough

6

LE11

£231,276

£639

3.3%

Oxford Brookes University

Oxford

49

OX3

£443,918

£1,226

3.3%

University for the Creative Arts

Farnham

44

GU9

£463,014

£1,269

3.3%

University of Bristol

Bristol

14

BS8

£460,385

£1,136

3.0%

University College London

Camden (London Borough)

10

WC1

£900,673

£2,056

2.7%

SOAS University of London

Camden (London Borough)

37

WC1

£900,673

£2,056

2.7%

London School of Economics and Political Science

City of Westminster (London Borough)

4

WC2

£1,445,306

£2,782

2.3%

King's College London, University of London

City of Westminster (London Borough)

20

WC2

£1,445,306

£2,782

2.3%

Imperial College London

City of Westminster (London Borough)

5

SW7

£2,002,729

£2,886

1.7%

  • icon

    I see from the table that I can expect a 4.4 % yield from UEA students in Norwich, I do much better than that from good working tenants in Norwich, so why would I want all the hassle of renting to students, more trouble than they are worth, and their snob parents are worst still.

  • icon

    NEVER go the student road. Nightmare.

  • Paul Barrett

    Flakey students prepared to stop paying rent just because of a pandemic.

    Not worth LL risking all on this demographic.

    Plus many students will be going online.
    Uni is a 3 year jolly which could easily be reduced to 1 and a half years.
    No way would I ever invest in students.

    icon

    Most of these degree courses could with a bit of hard work be completed in half the time, all one big scam to make the universities and their over paid staff a lot of money, and the students the excuse not to have to find a job for 3 yrs.

     
  • icon

    I have yields of 10% plus from students in Glasgow's G12 West End. I agree about the snobbish parents but at least they are scared about their credit ratings and always fold and pay up if their offspring fail to pay rent or trash the property.

    Incidentally the basic premise of this article is totally flawed in that the average property is not the same value of property which is rented out for the average rent as they are in totally different markets.

    In St Andrews KY16 the average rent of around£1250 is achieved from a property worth around £200k or even lower which is much less than the average property purchase price of around £370k which could get around £3000 per month. In Glasgow G12 West End a rent of over £2000 per month can be achieved from a property worth £200k to £250k - so between 10 and 12% yields.

  • Paul Barrett

    Ah! Yes those wonderful yields all based on students wanting and paying for accommodation!!

    I certainly wouldn't base my viability on students paying rent come what may.
    I take your point about parents paying up for their feckless siblings.
    But does this always occur!?

    Certainly no idea how you operate with the ridiculous Scottish PRT.
    Hats off to you for engaging in such a market.
    Just not for me!

    Flakey and irresponsible students is not something I would wish to base my personal financial security on.

    Good then that there are what I consider as very brave LL such as you letting to this demographic in the area that you are in.
    I do wonder however as to whether your student clientele fully appreciate how fortunate they are in having a LL like you prepared to let to them!!

    icon

    Paul

    The loony SNP legislation has actually helped rents grow from £1500 per month in 2016 to £2100 in 2020 and I typically have 10 to 15 groups wanting to rent. The secret is to get the new tenants signed up in February and paying from 1st June or earlier, knowing that they will leave as soon as they can, often in early May in final year.

    2nd and 3rd year students will pay throughout the summer as they don't want to risk losing my flats which are all very near the University and kept in pristine condition.

    I have never had to go to court as the threat of court action and peer pressure on joint and several liability from all guarantors is enough to ensure no rent arrears or unexpected repair bills.

    My "professional" tenants, on the other hand, are much less reliable, even with guarantors in place and my only eviction was of a DSS tenant - so never again!

    I can tolerate snobbery and demanding parents provided it's matched with top level rents paid on time every month.

     
  • Paul Barrett

    I admire your business nous.
    Just I know not for me.

    I consider perhaps LL such ad yourself the mire 'professional' among us.
    Being a student LL is not for your average joe LL.
    Hats off to you and your ilk

icon

Please login to comment

Zero Deposit Zero Deposit Zero Deposit
sign up