Student surge could create opportunities

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Melbourne and Sydney have been named in the top 10 cities for students to live in, according to a new report by global ranking company QS.

Australia was the only country to have two cities in the annual QS Best Student Cities 2012 top 10, with Melbourne being ranked fourth and Sydney sixth. The other Australian capital cities that featured in the top 50 were Brisbane (22), Perth (25) and Adelaide (29).

Australian cities scored well for their quality of living and student mix, but rated poorly for affordability. Their average ranking of 29 out of 100 for affordability put them in amongst the most unaffordable student cities in the world, according to QS.

The news comes in the wake of new figures that reveal that Australian universities are approaching record enrolment numbers. More than 220,000 university offers were made this year, an increase of 4% from this time last year, according to data from the Department of Industry, Innovation, Science, Research and Tertiary Education.  

Property academic and author, Peter Koulizos believes that now is time to capitalise on increasing student numbers. “There are currently great opportunities available to invest in student housing,” he said, adding that potential investors should follow a few rules.

“Properties should be close to university campuses and public transport, you need at least four students to make it work, and stay away from purpose-built student accommodation,” he said.

Phil Manning, Senior Property Advisor at WBP Property Group agrees that investors who are looking to take advantage of increasing student numbers should remain cautious and stay away from dedicated student accommodation.

“Banks are reluctant to lend to investors who are after student accommodation, and it’s difficult to get a large enough loan from the bank,” he said. “Most student accommodation is for students only; this limits the class of tenant and the resale value of the investment.”

Student Hotspots:

Source: Peter Koulizos

What are your thoughts on renting to students? Join the debate on our property investment forum.

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