An October 2017 article by The Guardian notes an increasing number of students looking for luxury accommodation, and who are prepared to pay extra rent for better facilities.
Many luxury student accommodation is purpose built. An example is Eclipse in Cardiff, which has a nightclub, private cinema, fitness suite, games room and function room, as well as has study rooms. The rent for a one-bedroom flat in the Eclipse building is £1,222 a month.
Purpose built student accommodation has risen by 80% in the last 10 years. Most of these new blocks are of a high standard, with an average rent of £193.76 a week. This compares to a room in a shared house at an average rent of £106.63 a week.
In London, some students are prepared to pay premium prices for luxury accommodation. An en suite room with study area and kitchen at the Liberty Plaza is £380 a week. Students have to commit to paying this for 51 weeks a year – not just during the academic year. The Liberty Plaza is near the London School of Economics and King’s College, and is fully occupied.
Many individual private landlords are not in a position to build large purpose-built student accommodation blocks, but they can take advantage of the demand for luxury accommodation by converting large houses to high-standard accommodation and also add extra facilities. The extra rents charged may be enough to repay the investment in refurbishment work.
Various finance options are available for creating luxury student accommodation, including commercial mortgages and bridging loans.