As the UK enters a new stage of the Brexit negotiations and prepares to depart from the European Union on the 29th March 2019, the period of uncertainty which has permeated the UK appears to be lifting.
However, for landlords who own student HMO accommodation, Brexit’s effects on the student property market are no doubt at the forefront of their minds. We explore what has happened to the student letting market so far, and look to future of student housing, post-Brexit.
How Has Brexit Affected University Applications in the UK?
There are currently almost 1.8 million full time students studying in the UK. While uncertainty does remain around the future of some areas of funding to universities which comes directly from the European Union, the appetite for a UK university education is extremely unlikely to subside, no matter how Brexit is handled.
The UK’s reputation as a leading place of education means that there are a high number of international students who are attracted to studying at British universities. In fact, around 23% of students studying here are from overseas. However, the majority of these students are actually made of those who come from outside of the European Union. In fact, 7 out of 10 international students came from non- EU countries in 2016, with those coming from Asia making up the largest group of international students.
For landlords considering the short term implications, despite a dip in applications from EU students in 2016, there has actually been a last minute rush of applications from students within the EU who want to apply before the Brexit door closes in 2018. Figures for applications for the 2018 autumn start date show that applications from EU students increased, for some universities by around 10%, which has more than compensated for the initial dip.
Looking beyond Brexit an astonishing increase of applications from Mexico of over 50% year on year has been attributed to the Donald Trump administration.
Demand For Student Accommodation in the UK
With many universities around the UK struggling to provide students with residences, increasing numbers of students are seeking accommodation within the private sector, and sharing a student HMO is a very attractive option for many.
Indeed the depreciation of sterling has made living in the UK an attractive option to many as the cost of living has reduced. For students living on modest budgets, shared student accommodation is a perfect solution for enjoying the benefits of university education at a reasonable cost.
In most university cities, the demand is still very much outstripping the supply when it comes to student housing. Occupancy rates are at higher levels than ever before.
Student Haus offer landlords of student HMO’s a tenant finding and management service. Our sole focus is student tenancy management so we understand the complexities of managing HMO properties and can offer you a fully tailored service which will help you make the best returns on your student property investment whilst keeping your tenants happy.