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Purpose Built Student Accomodation resale explained

Investment Fundamentals student accommodation resale
Jan 12, 2016

Before investing in property, it is always important to understand your options when it comes to reselling your asset.

 

Ensuring resaleabilility

Simply speaking, this is reliant on the long-term appeal of your asset to investors, which, in the case of  Purpose Built Student Accommodation, is determined by its ability to generate sustained high NET yields.

Any fixed NET yield above 7% will always be attractive to property investors.

If this yield is proven – i.e. the property has been delivering it for a set number of years – this will further enhance its appeal.

This is illustrated by the fact that 80% of the £5.9bn transacted in the UK PBSA sector in 2015 went towards the purchase of resale units.

Furthermore, if the yield is fixed – i.e. the investor receives it regardless of performance or costs – PBSA investment then becomes highly sought after.

 

Our approach to resale

With Emerging Property’s model, property investors receive 8-10% NET fixed yields over a 10-year period.

This fixed income period is fully transferable at resale.

These yields are the highest available in UK property and will thus always be attractive to other investors – in 10 years’ time as much as today.

In fact, the longer any rental property or rented accommodation is proven to be able to generate high yields, the more attractive a proposition in becomes.

For those looking to sell at a profit, such high yields also enable this. With 10% NET yields, even a 40% uplift in the asking price will still provide a yield of more than 7% NET to the new buyer.

For those looking for a quick sell – anything above 8% on a fully operational property will be snapped up almost instantly.

Further reading

Of course, the property’s ability to sustain long term demand is key for the continuing appeal of your asset after the initial 10 years. And to ensure high standards throughout, the property must also be maintained and managed by a professional onsite team.

To find out more about what makes us different and to discuss purpose built student housing, just get in touch with us!

 

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