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Expatriate Health Insurance News: Expats invest in overseas student property to recoup costs

Expatriates whose children are heading to university overseas are increasingly investing in student accommodation where their offspring study.

A report in the Telegraph looks at how expats are using this method as a way to recoup some of the cost of tuition fees.

The idea is that money is saved on rent for the student, but then an income is obtained by keeping the property on after they have graduated.

Rental yields on this type of accommodation in the UK are higher than those of residential houses, according to a report by Savils, meaning student properties perform well as an asset class.

Expats do not have to confine themselves to the UK if they wish to take advantage of the situation, especially if their offspring have chosen to study in another country.

Australia and the US are both popular destinations for British students and offer similar potential for investment.

The 426,411 international students in Australia as of August 2013 and recent falls in the Australian dollar mean many expats will look to the country's main cities to buy property.

Alex Bellingham, a director at IP Global, told the news provider: "The universities in Australia, the UK and US dominate the list of top universities throughout the world and continue to attract a large portion of international students year-on-year.

"The consistent rise in international students means a soaring demand for student accommodation in these countries, and this translates the asset class into a lucrative investment."

If looking to Asia, then Mr Bellingham suggests Japan as the best bet, as it has a large number of students and the yen is relatively cheap at present.

Back in the UK, Savils identified nine university towns it believes will offer the best returns on accommodation investment in the coming months.

These are Bath, Brighton, Bristol, Cambridge, Cardiff, Edinburgh, London, Oxford and St Andrews.

The total average return on investment on student property for the 2013/2014 academic year in the UK is 9.3 per cent, making it a worthwhile option for many.

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