Date Published 08 February 2016
Recently I was on the phone to a returning client of mine, who is once again looking for another Buy-to-Let property in the Marylebone area. He asked me where I thought he could acquire a great property investment, but also one which would prove to be a tenant goldmine, year on year. The Scalene triangle of Marylebone universities (as I like to call it) immediately popped into my mind, which consists of the university trio – the most prestigious being the University of Westminster (Marylebone campus), then The Royal Academy of Music, which is a constituent college of the University of London, then lastly we have London's sole independent university – Regent's University. This area, I advised him would undoubtedly produce for him an endless supply of tenants, with new and recurring students attending these educational establishments year on year. These students would require accommodation and would be able to afford the Marylebone prices, with the extensive amount of students' loans available. Students studying courses at these universities would ideally choose to be within the closest possible distance to their faculty, which subsequently would make the nearby streets a prime choice of accommodation including: Marylebone High Street, Luxborough Street as well as Nottingham Place – these streets make up some of the most sought-after student living spaces in the area.
My client seemed very happy with this, but asked me to help him out further by providing him with some of the rental potential in these specified streets, so that he could see for himself just how good of an investment a property in this area could be. So in this article I will present to my readers the results that I acquired for my client, but I also want to show you just how profitable the Buy-to-Let market can be, should you decide to invest in a property nearby our university hotspot. To illustrate, I will be using the nearby streets of Marylebone High Street, Luxborough Street and Nottingham Place, where I will be outlining the average values of 2 and 3 bedroom properties in these areas. I will also be portraying the rental values that these properties possess, as well as the rental yield that can be extracted from them. More often than not students tend to live with their peers rather than be able to afford sole living arrangements, which is why I have omitted 1 bedroom properties in this case to give a more realistic impression of the current market.
· Marylebone High Street (W1U):
Average Value of 2 Bedroom Flats: £1,195,000 - Average Rental Value: £3,631 (pcm) - Potential Rental Yield: 3.64%
Average Value of 3 Bedroom Flats: £1,689,714 - Average Rental Value: £4,850 (pcm) -Potential Rental Yield: 3.44%
· Luxborough Street (W1U):
Average Value of 2 Bedroom Flats: £1,062,384 - Average Rental Value: £3,025 (pcm) - Potential Rental Yield: 3.41%
Average Value of 3 Bedroom Flats: £1,965,000 - Average Rental Value: £5,683 (pcm) - Potential Rental Yield: 3.47%
· Nottingham Place (W1U):
Average Value of 2 Bedroom Flats: £1,661,909 - Average Rental Value: £4,729 (pcm) - Potential Rental Yield: 3.41%
Average Value of 3 Bedroom Flats: £1,752,500 - Average Rental Value: £5,075 (pcm) - Potential Rental Yield: 3.47%
With these results, we can see that a very healthy rental yield can be achieved with the properties on all three streets, with an overall average of 3.48% for 2 bedroom flats and 3.46% for 3 bedroom properties. Nonetheless, these findings merely show us a series of averages that should be achieved within these university hotspot streets, but the potential quite frankly can easily exceed this, where with universities admitting a growing number of students each year, demand will increase further every year, whilst your property's proximity to the university will remain constant. This would entail potential landlords to increase their rental prices in these prime streets, with your property's rental yield systematically increasing as well; an investment in this area could prove lucrative presently as well as becoming a solid investment for the future! In addition, you will always have tenants available – the universities are your everlasting suppliers! Renting a property in Marylebone is becoming increasingly popular and generally in demand with your everyday tenant, but being located next to these universities increases your tenancy options even further – which is always nice isn't it! Investing in a property around this area is definitely a smart move, so I certainly advise you to keep your eyes peeled for any properties coming onto the market, within close proximity of these universities - it could be the best decision you make!
Should you require any more information about properties in this area or student living trends outside halls in Marylebone, please feel free to contact me at any time and I will be glad to provide you with any details at my disposal.