Purpose-built student accommodation (PBSA) provides property investors with far higher rents than houses in multiple occupation (HMO), according to recent findings from Knight Frank.
Earlier this week, the property specialist released its Student Property report for 2014, showing the difference in rents between PBSAs and HMOs.
It found that rents for PBSAs are 75% higher in Oxford and Newcastle than rents for HMOs, while they are 56% greater in London.
Indeed, rents in the capital can be as much as £299 per week for studio accommodation, according to Knight Frank. With far higher rents, investors can expect stronger rental yields.
Knight Frank’s Head of Student Property James Pullan said: “Confidence in the sector is evident, and demonstrated in a simple way by the schemes currently taking shape around us.”
The firm reported average total returns for the 12 months leading to September 2013 were 7.8%, which is higher than other traditional commercial asset classes, showing student accommodation performs well for both PBSAs and HMOs.
Investors interested in benefiting from these high rental yields can buy a modern, high-quality student apartment from Vita Student, with the luxury student property brand having developments in Manchester, Liverpool, Exeter and Bristol.