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Sancho Panza

Student Houses: Failed To Let Hitting Market?

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Whilst oppurtunity grazing on RM,I've noticed in the last week a significant increase in clearly ex student accommodation hitting the rental market.

I saw a few last year in cities over the the Midlands come up for rent and subsequently for sale,in areas that previously had seen pretty strong demand from tenants.

It appears to be initially at least,in the more marginal areas,as you would expect,but I've also seen some,what you might term,'prime' student lets in areas of the Midlands,go to void for this academic year just started.

My question.Am I imagining things?

Edited by Sancho Panza

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Whilst oppurtunity grazing on RM,I've noticed in the last week a significant increase in clearly ex student accommodation hitting the rental market.

I saw a few last year in cities over the the Midlands come up for rent and subsequently for sale,in areas that previously had seen pretty strong demand from tenants.

It appears to be initially at least,in the more marginal areas,as you would expect,but I've also seen some,what you might term,'prime' student lets in areas of the Midlands,go to void for this academic year just started.

My question.Am I imagining things?

Probably not, student numbers must be down, many Uni`s are building their own accommodation, and there are probably a fair few "Uni`s" set to go bust in the future? All downhill for student BTL IMO.

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You probably aren't imagining things.

If they don't let to students try other markets then if all those fail to bring in any sensible amount of rent flog before the losses rack up too much. This may come as rude shock to many of the LLs.

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I've seen a few student HMOs being offered in Chester, even some with tenants in situ for the coming year. Fees must be hurting student numbers, and also those who choose to go to a university away from home. Add in large building of student accomodation and it's easy to see why the future is not so rosy for student landlords in many areas.

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Queens University in Belfast have said their intake for 2013 is stable (though they would wouldn't they -at least until the stats come out anyway) :rolleyes:

The amount of empty student lets in the university area has grown for the past two years. This week I spoke to a LL with 4 properties in the catchment area. Only 2 are let - 1 possibility and 1 empty. They are dumps though - last resort flats. The 2 that are let were both let at a lower rate than 2011. Not by much but a significant indication that LL's are realising what is happening to the market I feel.

These flats/houses are unlikely to appeal to anybody except students as the area is renowned for a spot of student trouble. Not family or professional friendly.

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Queens University in Belfast have said their intake for 2013 is stable (though they would wouldn't they -at least until the stats come out anyway) :rolleyes:

The amount of empty student lets in the university area has grown for the past two years. This week I spoke to a LL with 4 properties in the catchment area. Only 2 are let - 1 possibility and 1 empty. They are dumps though - last resort flats. The 2 that are let were both let at a lower rate than 2011. Not by much but a significant indication that LL's are realising what is happening to the market I feel.

These flats/houses are unlikely to appeal to anybody except students as the area is renowned for a spot of student trouble. Not family or professional friendly.

I think the same is happening in Cardiff ,last November there were hundreds of to let /for sale boards around the student areas will be interesting to see what its like this november

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If they don't let to students try other markets then if all those fail to bring in any sensible amount of rent flog before the losses rack up too much. This may come as rude shock to many of the LLs.

It's been a cash cow for many years and those with sensible yields still have some significant downside protection.Student numbers are stable but it would appear more are chooisng to live at home.

A good friend had a large portfolio and sold up some 7/8 years ago when he saw the large scale buildings being erected Midlands wide.

Some of these houses are in popular areas,close to town.

It's interesting how many of these places fail to find professional tenants when they cross over.

Edited by Sancho Panza

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I was looking on Gumtree, vast numbers of student lets swamping all other rental adverts. As it's now September and everybody knows what uni they're off to there are going to be many rooms unlet.

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Whilst oppurtunity grazing on RM,I've noticed in the last week a significant increase in clearly ex student accommodation hitting the rental market.

I saw a few last year in cities over the the Midlands come up for rent and subsequently for sale,in areas that previously had seen pretty strong demand from tenants.

It appears to be initially at least,in the more marginal areas,as you would expect,but I've also seen some,what you might term,'prime' student lets in areas of the Midlands,go to void for this academic year just started.

My question.Am I imagining things?

Just took a Rightmove trip down memory lane in the area I used to live as a student many years ago in Birmingham. Much of the street and adjacent streets seem to be up for sale. The new term starts in three weeks. The agents blurbs are talking about 8%+ returns, people don't sell good investments do they? Most seem to have come on in April/May, perhaps they're all part of a portfolio. The area in question is not a marginal one, ten minutes walk from campus.

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Just took a Rightmove trip down memory lane in the area I used to live as a student many years ago in Birmingham. Much of the street and adjacent streets seem to be up for sale. The new term starts in three weeks. The agents blurbs are talking about 8%+ returns, people don't sell good investments do they? Most seem to have come on in April/May, perhaps they're all part of a portfolio. The area in question is not a marginal one, ten minutes walk from campus.

Perhaps B'ham is more vulnerable than a lot of places to this - a large population within a commute of the campus so lots may apply for courses there to save money. And it's a good university.

I know of a student commuting there from Hereford - a `no changes' train which stops in the campus station - 80 minutes.

If only the young yokels had been so frugally minded.

Y

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There was a Gross BTL yield graph posted in another thread lately which showed gross yield declining over time. Is it now possible that net yields (assuming no voids) are <1% with no prospect of recovery hence mass exits?

Or are LLs just selling when the property needs major work which they can't afford or finance?

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Thx W

As the other guy said it's the purpose-built section of the market. Agreed but not a great deal of difference in that a major major player is stuffed bcos investors wanted out. A) No-one could possibly have seen that might happen... B ) Lots of BTL investors want out...

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Thx W

As the other guy said it's the purpose-built section of the market. Agreed but not a great deal of difference in that a major major player is stuffed bcos investors wanted out. A) No-one could possibly have seen that might happen... B ) Lots of BTL investors want out...

I'm seeing a few student HMOs up for sale in my town (Chester), tallies with Brandeaux's experience.

And here's a company insolvency in Salford this week, 36 residential HMOs:

http://www.accountancylive.com/croner/jsp/Editorial.do?channelId=-601070&contentId=2729594&Failed_Reason=Invalid+timestamp,+engine+has+been+restarted&Failed_Page=%2fjsp%2fEditorial.do&BV_UseBVCookie=No

Salford student accommodation company in administration

03/09/13

Pat Sweet

Just prior to the start of the new academic year, David Costley-Wood and Brian Green, restructuring Partners at KPMG, have been appointed joint administrators to Salford Student Homes Ltd (SSHL).

Costley-Wood and Green have also been appointed joint receivers over one commercial site and 36 residential properties in Greater Manchester, which provided accommodation for students at universities in the area.

The commercial property and 25 of the residential properties were owned by a private individual. The remaining 11 properties were owned by Brentwood Commercial Limited (BCL). All of the sites were operated by estates management business SSHL, which had one employee who has been made redundant.

The joint administrators have appointed residential property management specialist Touchstone CPS to manage and maintain the properties, handle all lettings and provide the full range of tenant services on an ongoing basis.

David Costley-Wood, joint administrator, joint receiver and restructuring partner at KPMG, said: ‘SSHL and the associated properties have been unable to sustain their financial commitments in challenging economic conditions. We are committed to minimising disruption to students and tenants and ensuring day-to-day operations across the estate are maintained.’

Edited by cheeznbreed

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there has been a massive boom in student accommodation in the market in recent years. it used to be just halls of residence however now there are lots of universities and colleges popping up everywhere which need accommodation.

lots of student accommodation is a good thing because ultimately it frees up housing.

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Yesterday I received an unsolicited email about this development:

All Saints, Sunderland

"Prime Student Buy to Let ; Yields of 9% for the first 2 years; Studios from £39,950."

:unsure: I wonder if the developers are concerned about the lack of interest?

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As I wrote on another thread this week but can't find it:

Hasn't there been a thread on this?

The article appears to be spinning a certain level of nonsense:

27-month wait to exit suspended property fund

Whoops! But then later:

... but accessible to UK investors via the Dublin stock exchange.

OK, I'm confused. If it's listed on a stock exchange then investors can trade it regardless of any problems in the underlying portfolio. Isn't the story just one of what price they can get for it?

That thought process took me to "hmmm, could this be a good vulture buy?" (if there's a big discount but not too big spread), so I looked for information. But I was unable to identify the listed funds as a startingpoint for DYOR.

Confused!

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