Investing in
student accommodation is more of a yield game and not really about huge capital
growth. Student accommodation is a low-cost entry point for first-time
investors and is quite a low risk compared to other types of investment options.
Australian universities attract a high number of
international students, so there is less risk of being left without income for
your investment and in addition, parents more often
than not, will act as rent guarantors.
In addition, many universities will support
landlords in finding tenants for student-specific accommodation.
Students that live close to university generally
don’t need a car, which means that landlords don’t need to provide car spaces
and there may be opportunities, to increase tenant numbers, from the additional
room in the property.
This gives you the added advantage of having
diversified income streams, so if one tenant leaves, you will have others still
paying rent.
Investors may need larger deposits as banks compare
student accommodation to a studio-sized purchase and that these types of
properties can be harder to sell and the resale value isn’t as high as normal
dwellings.
Student accommodation is also recession-proof and
in fact, when fewer jobs are available, people are more likely to consider
university.
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Jason Gwerder
Wednesday, 27 May 2020
