Despite the struggling property market, the student accommodation sector remains stronger than ever. A high occupancy rate coupled with rental growth makes it a lucrative investment. It does however come with its own problems for the investor. There is a very limited availability of developer debt funding which makes it hard to build new property.

Every year the number of students to accommodation available continues to rise resulting in an unfulfilled supply and an ever growing demand. There is huge potential in this market, analysts claim.

A supply and demand balance points to a robust future in this sector. While demand continues to rise, capital values of property held won't go down. It has for the most part survived the financial turmoil that affected the other markets.

Credit lenders continue to shun the opportunity calling it a high risk investment. There are only a few investment vehicles such as retail funds which allow investing into student's accommodation.

Whilst credit funding in this sector remains low, it will continue to be an excellent investment for the smart investor.

Interested in discovering new more profitable avenues to invest in? Get in touch with a Clear Property Investment agent for a consultation.

View other news from July 2009