Property owners who have empty offices to rent are being encouraged to consider entering the student accommodation market.
Currently, a change of use in the building will require planning permission from your local authority, but with coalition proposals to allow the conversion of commercial sites into residential without approval being needed, this may soon be the face of commercial property conversion.
This follows a recent trend in the Netherlands, where investors are rapidly redeveloping empty office space into student accommodation to both fill up such blocks and also keep up with increasing demands for student property. In a new report by Savills, it emerged that the student housing sector is becoming a hot topic for both domestic and foreign buyers.
Joeren Jansen, head of research at Savills in the Netherlands, said: "Banks are more and more willing to finance this sort of property, and achievable yields are in the region of six and seven percent depending on location."
On average, students will pay in the region of £300 and £350 a month for private halls in the Netherlands, with these figures peaking to £450 in Amsterdam. November 2011 saw the Dutch government remove building regulations to allow 16,000 new student rooms to be built by 2016, with a low supply of accommodation available, many are entering this secondary market, and this could also happen in the UK.
Investors are, therefore, being encouraged to shift their gaze towards student accommodation. It will also be a favoured market with less competition, as seen in prime properties in central London, and therefore great benefits can be achieved in the long term.