Demand for student property is soaring around the world - and not just from students. As the euro debt crisis continues, student accommodation is proving a popular choice for investors as the number of university applicants continues to climb.
In the UK, universities worried that rising tuition fees would deter youngsters from applying to study this year. Their fears seemed justified this month, as Ireland reported a rise in the number of university applicants from the UK.
Applications rose by 28 per cent compared to 2011, the Republic of Ireland's Central Applications Office confirmed, with the Republic's fees of £1,810 per year more affordable for Brits than the potential £9,000 they face at home.
Scandinavian universities have also seen a spike in UK interest, with students attracted by the total cost of tuition fees: zero.
"Fees for European universities make them a really competitive option, even with added costs of travel," Di Henderson, Head of Sixth Form at Marine Academy Plymouth told The Independent.
But student numbers are on the up outside of Europe too. In Malaysia, figures have surged to over 90,000 (2 per cent of the total international student population), ranking the country's student body as the 11th biggest in the world.
This increasing demand has seen housing reach critical levels of supply, prompting a wave of new developments and eager investors, who see student housing as more reliable than many other sectors of real estate.
Investment company Qudoss told the New Straits Times: "During recession, people take student grants to get back to school. Usually, rental is paid six months in advance so the rental is guaranteed."
While Malaysia's property fills up with students, the UK's housing market is seeing a similar surge, with UCAS reporting a 13.7 per cent rise in overseas students applying to study in Britain.
Investors are doing much the same, coming from home and abroad to capitalise on the property investment that never seems to run out of tenants, no matter what the country.
Ray Withers, CEO of student property investment experts Property Frontiers, spoke to TheMoveChannel.com about the continuing strength of the sector:
“Purpose built student property has outperformed every other commercial property class according to Knight Frank in their Student Property Report 2012 and has consistently thrived on the fundamental imbalance of supply and demand. This is because constantly high student populations in major university towns coupled with increasing demand for limited modern quality student accommodation (opposed to most Universities’ ageing campus stock) ensures these properties are near 100% occupied and at the best rates.
"Furthermore, with massive increases in overseas student numbers the purpose built student accommodation market continues to perform during continuing external pressures in the wider economy.
"With en-suite student rooms and studios now available to individual investors with low cash investment levels, high returns and in many cases proven income streams, this asset class continues to be a very reliable and popular choice.”
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