According to a recent survey, London is ranked not just as the best student city in the world but is also the only city with the most top-ranked universities globally.
In this blog, we explore how overseas parents can secure their child’s future by investing in London property near prestigious educational institutions. Not only does this investment provide a comfortable living arrangement for your child, but it can also yield financial benefits in the long run. Let’s find out the impact of international students on the UK’s economy and uncover the advantages of investing in London property for education.
In its latest report tracking the impact of international higher education students on the UK economy, analyst London Economics has estimated a significant 58% increase in the net income from overseas students between 2019 and 2022. While the number of international students in the country increased by 40%, net income to the UK economy grew from £23.6bn to £37.4bn. Earnings from foreign students enrolled in universities in Glasgow, London, Sheffield, Nottingham, and Newcastle were among the highest.
London’s top-ranked universities attract a significant number of international students each year. These students often seek accommodation near their educational institutions, creating a high demand for rental properties close to their campuses. As a result, the rental market around these areas experiences a surge in demand, leading to increased rental prices and a potentially profitable investment opportunity for property owners.
While the average rent per month for the postcodes around top UK universities such as Lincoln, Loughborough and Durham are slightly below £700/month, this is highest for London’s Imperial College, where the average asking rent is £4,140 per month on average. Following in close are King’s College London and London School of Economics, where the average monthly rent is above £3,100 per month. Properties around University College London and SOAS command an average rent of around £2,400, while accommodation near the UK’s top two universities, Cambridge and Oxford, yields an average rent of around £1,500 per month.
London’s rental market is well known for its exorbitant prices, which can financially stress students and their families. However, by strategically investing in a property near London’s top-ranked universities, parents can both eliminate high rental expenses and pay for their child’s education.
Property values near London’s elite universities tend to appreciate, generating significant capital growth. By leveraging this growth, parents can tap into the equity gained from the property to cover tuition fees, living expenses, and other educational costs. Here’s what parents need to do when planning to invest in a London property to secure their child’s future.
i. Choose the right location: To maximise savings and investment potential, selecting the right location is most important. Consider properties near prestigious universities such as Imperial College London, UCL, King’s College London and LSE. These areas experience strong demand for rental properties, ensuring consistent rental income and potential capital appreciation.
ii. Research and professional guidance: Conduct thorough research on the local property market, including rental demand, vacancy rates, and historical price trends. Seek advice from property investment specialists who possess local knowledge of the London market and can guide you through the investment process. They can help identify prime locations, analyse market conditions, and assist in property management.
Immediate savings on high rents is just a short-term benefit of investing in a London property. The property’s potential for capital appreciation offers a financial safety net and a valuable asset that can be used to generate rental income even after your child completes their studies.
Besides the financial advantages, living near prestigious universities offers numerous benefits to your child’s academic journey. Proximity to the campus allows for easy access to lectures, libraries, and extracurricular activities, fostering a conducive learning environment. Additionally, it eliminates the hassle and time spent commuting, enabling your child to focus on studies and actively engage in campus life.
London is renowned for its world-class education, featuring a prestigious collection of universities, colleges, and schools that consistently rank among the best in the world. Overall, investing in London property for your child’s education can be a strategic move that combines both financial planning and educational opportunities. It can provide the potential for capital growth, rental income, and access to world-class educational institutions, contributing to securing your child’s future education. For more information on how we can help you find and maximise the right opportunity, please do get in touch.
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