Student buy to let investment due for major expansion, claims survey

A new report claims that over a third of student property investors plan to expand their portfolios in 2016, despite the government’s new stamp duty surcharge.

The research, commissioned by student investment firm The Mistoria Group, finds that one in 10 student property landlords say their HMOs enable them to offset the new tax rules and remain profitable, while a further 50 per cent do not believe any other asset class offers the same yields and return on investment as student property.

The report - based on a survey of 500 landlords last month - shows that 35 per cent of student landlords purchased HMO properties in the first quarter of 2016 to beat the new stamp duty rise and a further 43 per cent of landlords plan to acquire between two and three new student properties over the next 18 months. 

“The student property is a robust asset class. Since 2011, student accommodation has outperformed all other traditional property assets and has been the strongest growing investment property market in the UK.  It has also continued to be one of the most resilient investment sectors, with rental incomes and property values remaining stable, or increasing.  The attraction of the student accommodation sector has been driven by structural undersupply and positive rental growth year on year” claims Mish Liyanage, Misteria’s managing director.

“A high quality HMO in the North West which will house four students, can be purchased for just £160,000. The return on investment is very attractive too, with 13 per cent - that’s eight per cent cash rental and five per cent capital growth.”