UK student accommodation capital values continue to rise

UK student accommodation capital values have increased by 6.5% year-on-year to September 2018, according to the latest research.

The CBRE student accommodation index revealed that this figure was up on the 4.5% growth recorded in the year to September 2017.

On a gross and net basis, rents have increased 3% and 3.4% respectively.

The index is disaggregated into ‘central London’ and ‘regional’ geographies, with the latter being further split into super prime, prime and secondary.

Student accommodation in central London outperformed regional by a wide margin.

Driven by capital value growth of 12.4%, central London student accommodation annual total returns hit 17.5% for the year to September 2018, compared with 14.2% for the previous 12 months.

Regional student accommodation total returns to September 2018 reached 10.5%, with capital growth of 4.5%.

“UK student accommodation is now firmly established as a mainstream investment sector,” said Jo Winchester, head of student accommodation at CBRE. 

“Investors will find the increasingly sophisticated raft of influences on performance highlighted by this index – including location, asset scale, university rankings, applications and distance to university – very informative.”

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