Student housing is popular property time that is known to be insulated against recessions. These projects fail or succeed on the basis of fundamentals like college enrollment rather than economic cycles. In the situation of economic slowdowns, rental properties like multifamily apartments experiences vacancies. One may move in with a roommate or sleep on their parents’ couches for some time. But as universities do not shut down during recessions, the demand for student accommodation stays up. To take optimal advantage of the opportunities provided by this real estate domain, a number of companies have ventured into it over the years, Nelson Partners being one of them.
Economic downturns often motivate high school graduates to actually attend college, rather than opting to enter the workforce immediately. Economic downturns may even encourage workers who had been laid off to attend classes at the local university, so that they can learn new skills and gain further knowledge that allows them to be more competitive in the evolving job market. Rather than the economy in general, enrollment tends to be the key deciding factor when it comes to the popularity of a student housing property. Even though student housing investments do offer attractive risk-adjusted returns, one needs to gain better understanding of enrollment fundamentals, timings and geography, when it comes to investing in this sector.
The domain of student housing has significantly matured as an asset class over the last two decades or so, with new generations of students trying to explore more private and comfortable accommodation units in comparison to the traditional college dormitories. Owing to such changes in trends, developers like Nelson Partners jumped on board in the development of purpose-built, highly luxurious student housing projects.
The run-down, dilapidated apartments and houses that used to cater to the students traditionally are long gone. The brand-new student housing properties of today often features in-unit washers and dryers, stainless-steel appliances, granite countertops and even walk-in closets. They even come equipped with a range of communal amenities like fitness centers, study halls, hot tubs, swimming pools and Wi-Fi. Many owners of older properties are also choosing to invest capital to remain competitive with the newer product.
When considering to invest in student housing, one must try to target properties that are located as close to campus as possible. One may also invest is properties that are served by a regular shuttle or transit service alternatively. Enrollment rates in most colleges are increasing today. Higher enrollments mean more students, which invariably imply to more housing demand. Student housing properties can provide a much-needed diversification strategy for an investment portfolio. For the most part, they also are recession insulated. However, before investing their funds, people need to understand the dynamics that drive demand for the student housing sector. More details about these dynamics can be explored on the web. Details about best locations to invest in student housing can also be found online.
