Investing in student accommodation

Private Property South Africa
Lisa Dewberry

As thousands of students head to tertiary institutions yearly and need a place to stay, the demand for accommodation is always high. But before a buyer proceeds with a student accommodation investment, it is important to evaluate the requirements that play a role in making a buy to let investment a successful and profitable one.

Jason Vorster, national sales manager: Just Invest, a residential property investment company, says that the demand for accommodation in student towns is huge and that there are always shortages of these properties. Finding potential tenants is the easiest part of the transaction and the student accommodation investment yields are typically high.

“A property located close to a campus and which has good security will be convenient for students and will give parents peace of mind when sending their children to live far from home”

Jason Vorster, national sales manager: Just Invest

“When looking for a student accommodation investment, proximity to the campus, security and price all play a vital role in determining which property will yield the best profits. A property located close to a campus and which has good security will be convenient for students and will give parents peace of mind when sending their children to live far from home. Owing to the strong demand, sellers often ask for higher than actual market value for their student property investment, so it is important to do research about the student accommodation investment market and do comparisons to find the correct property, at the right price, in the correct location in order to make a profit when renting or selling,” says Vorster.

READ MORE: Affordable, quality student accommodation

Lesiba Mooka, CEO: Cobalt Blue Properties, an organisation of real estate professionals and auctioneers, says it does not always mean one will make a profit by just letting out a property; but by following basic principles of property investment, buyers will be able to make a good investment if they buy the right property and ensure it is well maintained. He says that when buying student property, the location, amenities, size and price all play a role in whether the property will become a good investment.

“Before investing in property you should investigate the area thoroughly,” says Mooka. “The property should be easily accessible to public transport, should not be more than 2–3km away from the campus and should be within walking distance of a supermarket for grocery shopping. A local library nearby would be a bonus. The convenience of having all of their basic needs within walking distance of the property will make it more attractive to most students.”

Investors can find a variety of student accommodation investment offerings in different areas on Private Property’s for sale listings.

This article originally appeared in Neighbourhood, Sunday Times.

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