A group of happy students sat on a wall outside a house.

Is student accommodation still a good investment for landlords in 2025?.

13 Jun 2025 | 1 min

Did you know that in the 2024 / 2025 academic year, over 2.9 million students attended a UK university? For context, that’s a massive one million more than attended back in 2000.

With many of these students living away from home, including overseas students, it’s easy to see why student accommodation has become a bigger focus for developers and landlords, as demand and rental yields continue to grow.

In this article, we’re going to explore whether Buy to Let landlords looking to diversify their portfolio should consider student accommodation and discuss some of the benefits and challenges they might face.

What is student accommodation?

For most freshers, their first experience of student accommodation will typically be in the university’s own halls of residence, on or close to the campus. They’re a great way for new students to integrate and acclimatise to university life in a safe, secure and affordable environment.

For their second year, students will need to find their own place to live, and this is where the private rental sector comes in. There are two main types of private student housing, and both have their own benefits for landlords, investors and student tenants. They are:

A young women unpacking belongings in smart apartment.

Purpose Built Student Accommodation (PBSA)

Large apartment complexes specifically designed and built for students.

With modern amenities and facilities, a community feel, convenient location close to campus, and all bills included in the rent, these managed properties offer students security and quality assurance.

PBSAs provide higher rental yields than private properties and could be ideal for hands-off investors. However, it can be harder to find financing and capital growth is less than some other assets.

Read how we helped an investor secure an 850 bed PBSA portfolio.

Case Study

A group of students eating breakfast and talking in a shared kitchen.

Owned by a private landlord

Single houses or flats that the landlord has chosen to rent out to students. These include larger houses that have been converted into a House of Multiple Occupancy (HMO).

Rents are typically more affordable than in a PBSA apartment, but students may not have the same quality assurances and usually organise and pay their own utilities (e.g. internet, electricity, and water).

HMO landlords have more freedom over rental prices and properties can benefit from capital growth, but landlords are responsible for maintenance and damage costs.

Find out about our HMO mortgages.

HMO mortgages

How will the Renters’ Rights Bill affect student housing?

Although the Bill is expected to become law this summer, it’s still in the stage where amendments are being proposed by members of the Commons and the Lords. That means that some of the key areas of the bill that will affect student housing lets are still up for debate, but here’s what we know at the moment.

No fixed tenancies – Assured Shorthold Tenancies (ASTs) are set to be replaced by periodic, rolling tenancies. This basically means that student tenancies can’t be fixed to last a year (or any other period), with the exception of PBSA properties.

Currently, landlords with HMO properties with three or more beds will be able to regain possession of their student properties in line with the academic calendar (under Section 8 Ground 4A of the bill).

An amendment proposed in the Lords has asked the government to extend the clause to include one and two-bedroom student properties as part of the report stage of the bill.

Decent Homes Standard and Awaab’s Law – The Decent Home Standard will set out a set of minimum quality standards for all private rental properties, to ensure that all tenants have safe and secure housing. Awaab’s Law also sets out timescales for landlords to investigate and resolve any hazards in their properties, including damp and mould.

In Save the Students’ National Student Accommodation Survey 2025, damp and electrical faults were listed as the two biggest problems with student houses.

Is it difficult to get finance for student housing lets?

With some lenders, yes, it can be difficult to get approved for funding on a student rental property. One of the most common reasons is that the type of building being purchased doesn’t meet the lender’s criteria as it may be built using non-standard materials, could need extensive renovation, or could be part of a semi-commercial property (i.e. a flat above a takeaway or shop).

Student housing can also be seen as risky by lenders due to the type of tenants involved and the increased possibility of damage being done to the property.

But it doesn’t always need to be the case as specialist lenders like Together provide a range of flexible finance options that can work in many of these scenarios and understand that the student housing market can be a lucrative opportunity for landlords looking for higher yields. Get in touch.

In our latest report Cities in Focus 2025 , portfolio landlords in some of the UK’s largest university cities pointed to student housing as one of the biggest opportunities for investment in the next 12 months, including Birmingham (23%) and Manchester (21%).

Read the report for even more industry insights on the Buy to Let, retail & distribution, and office space sectors.

Read our report