With traditional buy-to-lets, a third of landlords have experienced rent arrears at some point. According to the National Landlords Association, the average unpaid rent amounts to £1,649. With student property this is far less likely to happen. Most UK-based students will have their rent paid directly by parents, with many making block payments upfront which means that you don’t have to worry from month to month about the rent coming in. In addition, many overseas students will have their rent paid upfront by parents, and, in general, their spending power is higher as well.
Another potential issue with traditional buy-to-lets is experiencing void periods. The vast majority of landlords will rely on rent to pay all or part of the mortgage on a property. So, if the property suddenly becomes empty due to the existing tenant leaving unexpectedly, a landlord can find themselves in a tricky situation trying to pay the mortgage with no in-coming rent. There is also the hassle of having to remarket the property and find new tenants. Once again, with student properties, void periods are easily managed and built into the overall rental rate. The demand for student accommodation is so high that it renders void periods as negligible and because any potential void periods are predictable i.e. outside of term times, landlords can easily plan for them.
And then there’s the hassle of repairs and maintenance. In a traditional buy-to-let property, if a property becomes damaged for any reason, then the landlord will be the first port of call for the tenant. This means having to deal with phone calls, organising tradesmen, arranging for visits and repairs etc; all of which can be time consuming and stressful. With most student properties there will be a management company in place that deals with all these issues on your behalf, which means much less stress and a hands-off approach to your investment.
So, in summary, student property wins every time.