Following the Brexit decision, the number of students applying for university places has gone down, but this has not affected the level of student accommodation investments.
Applications for British university places among UK residents have fallen by 5%, and among European Union citizens they have decreased by 7%. However, according to a report by Isabel Fraser in a May 2017 Daily Telegraph article, student accommodation investments have increased by 17%.
It is expected that £5.3bn will be spent on constructing purpose-built student accommodation in 2017. This is an increase from the 2016 expenditure of £4.5bn.
Many of the people investing in student accommodation are international investors who represent 64% of the investments. Investing in student accommodation is particularity popular amongst Far East investors.
There is a fear is that overseas students may face immigration restrictions after Britain leaves the European Union. Universities are hoping that students will be exempt from any future immigration curbs.
The decision to leave the European Union was predicted by some to slow down Britain’s economic growth, but student property investment levels remain healthy.
Cushman and Wakefield, Commercial real estate agents, said that students’ rents have risen by an average of 2.7%. The average weekly cost of renting student accommodation is £126, although it is significantly higher in Oxford at £180.
There are lenders that specialise in providing commercial mortgages for student accommodation. A mortgage broker can find the best commercial mortgage deal for landlords investing in such areas.