The latest trend in student living
As a business which sources and project manages property investment opportunities, I wanted to share with you with the latest trend in student living which is proving a ‘win-win’ – giving investors a higher rental yield – and providing students with accommodation which complements their lifestyles.
These days, students are undoubtedly a more discerning, demanding lot than those portrayed in programmes such as ‘The Young Ones’.
While the antisocial anarchy and extreme squalor presented there might have been exaggerated, there is no doubt that for most graduates older than their late twenties, sharing a house with four or five strangers was not only something to be endured, but an experience they revelled in as some perverse rite of passage.
While communal areas are still acceptable with many students, some of the more reserved scholars are abandoning shared housing for self-contained, albeit compact, living spaces.
This emerging trend is called pod living.
A pod is a self-contained rental area in a student accommodation block. It usually comprises a basic room with bed, desk, washstand and essential furniture and often has a kitchenette. Central heating, double-glazing, fast broadband are all included, as are bills usually, with some sites often offering gyms, entertainment and storage too. While certainly not a ‘bargain basement option’, they can be a lot cheaper than plush private halls.
It is a known fact that while millennials are very social online, though, they are more reserved in the real world, relishing their privacy and fiercely guarding their little territory. More teenagers and twentysomethings spend more time physically alone and indoors by choice than ever before.
Beyond that, there are practical considerations behind the shift away from communal living. With the average student possessing thousands of pounds’ worth of electronic kit and high value ancillaries, they want to protect them. What better way than a solitary unit that is difficult for anyone else to access – a self-contained little world, where they have everything they need without having to open the door?
Prices & Returns
Prices and returns depend on location and the type of pod, micro studio or ensuite in question. Typically, in the north of England, they range between £28,000 and £48,000 and offer a promised ten per cent yield plus annually.
So far, so good, but anybody thinking about dipping their toes in the market should keep their eyes open too, because there are pitfalls.
A major stumbling block is that mortgage providers usually won’t lend on pods as they don’t view them as individual units so won’t be able to repossess them if payments aren’t kept up. In addition, as most leases stipulate that only students can live there, resale opportunities will be limited.
Many students are opting to rent these pods – with rentals varying from £125 to £145 per week on 48 to 50 week contracts.
Outside of the wealth of benefits outlined above, pod living also offers a much greater degree of personal security and residents do not have the awkwardness of sharing with somebody they don’t get on with.
The advantages are also apparent to undergraduates and not just Generation Ys – pods also suit mature students, who have rented or owned their own homes and value privacy and security.
Share your views on pod living with us, call us on 0113 827 2267, email firstname.lastname@example.org or follow us on Twitter @vidadevelopment