Krystel Ann Properties

Placements immobiliers locatifs vs chambres d'étudiants

By Chrystelle MERABLI
10/10/2013

Putting your savings in a real estate investment is always an important decision. Today, the low rate of return provided by the banks products has promted investors to increase their investment in properties. England, and specially London, is known to be one of the world's best “safe haven” for property investment.

Buy to let and student accommodations are two popular property purchases, but they offer different characteristics.

Buy to let investment

The buy to let (BLT) is the traditional way to achieve growth and income. London properties market shows amazing increase in property price up to 30%/year in Mayfair 1. The central areas and most of the surrounding boroughs are forecasted to see their price pushed up for the next years. It will become hard to find something under £13,000/m2 in zone 2, in the next 8 years. This is excellent news for chances of high capital gains.

The other good news for investors is the housing shortage which continuously put the rental price under upward pressure. In central London, and its close suburbs, finding a tenant is usually easy. Most of the properties are let in a few days. From shared accommodations to single family tenants the demand is huge.

However, BLT investment in the sought after locations requires a good deposit if you wish to get a mortgage or solid cash funds. Furthermore refurbishment and decoration costs must be planned in advance as well as how you will deal with the day to day management.

Student accommodations

Buying a student accommodation is often a choice made by individual who wants to have monthly incomes from their savings.

Picture legend: Student accommodation in Bristol starting price £78 to 299, 7% yield guaranteed for 5 years.

The UK is known to be a demanded destination for international students. Cities like London, Manchester, and Liverpool… are known to be university cities attracting many international students. The demand for high standard student accommodation is significantly growing, while the actual offer of accommodation is far below the demand.

The best developers guarantee the minimum net income yield (7% to 9%) for a few years, as well as capital growth (around 4%/year)3. The buyer doesn’t need to care about finding tenants or day to day management of the property; it’s a hassle free investment.

The success of student accommodation is mainly due to the high income yields and the low amount needed to invest. People who choose to put their funds in such an assets are attracted by the security of cash flow. But on the other side, it is not an investment that generates high capital gains like the BTL.

For more information about property investment please do not hesitate to contact KRYSTEL ANN PROPERTIES team, we will be glad to be part of your project.

Website: www.krystelannproperties.co.uk,

email: info@krystelannproperties.co.uk,

tel: +44 (0) 20 3239 7998.

Sources: