Student accommodation, should I buy or rent??

Rosie1894

My daughter has started university this year. It's an expensive area (west  London), and she expects to be there for 5 years in total. We have savings from an inheritance, would we be foolish or wise to buy a flat in the area for her to live in for the next 4 years? 

dimbo61

Can you afford a 2 bed flat so she can rent out the second bedroom ?
Is she an only child ?
Are you going to pass this inheritance money onto your daughter anyways ?
You could gift the money to your daughter or speak to a solicitor to change the will and pass the inheritance money to your daughter direct 
OR you could gift the money with a legal agreement that she has to repay you if she sells the property.
Only you can decide 

Rosie1894

Thanks for your comments. Yes she is an only child, her grandfather wanted the money to go to her eventually but not directly until she's 25. 

Bluebell1000

Living in halls can be part of the university experience, so I probably wouldn't at least for year 1, though I think from your post she has started there already?
Would she want to live in a flat on her own?
What if she decides uni isn't for her, or that she wants to switch to a uni elsewhere?

md258

I would say keep the money yourself for a few years and let her rent with friends. That way she won't have the hassle of being the landlord when things go wrong in the middle of her exams, a housemate having a partner move in or falling out with everyone else in the house and being unable to leave. Or when she finishes uni and wants to travel around the world but not be a remote landlord and then live in another country/city.

Part of the fun of student years is living in awful properties with rubbish landlords with your friends. It will probably make her more appreciative of things when she does buy a property.

On a side note, does she know about the money? It might be a nice surprise to have some extra deposit money when she decides that she is ready to buy (with FTB incentives).

Rosie1894

Thanks those are good points I hadn't thought about, I was focusing on the cost of renting but forgetting the stresses of being a student and potentially also the responsible owner and possibly landlord. Very helpful comments from everyone putting things in perspective 

lookstraightahead

My daughter lived in a revolting house in her third year. I mean truly awful.

Probably because of this they are all best friends, to the point that they all decided to move and work in the same city hundreds of miles from their uni.

I personally wouldn't make your daughter 'stand out' from other students. 

Spendless

How much does she receive as maintenance loan? Enough to pay her own rent and still have some money to live on or do you need to contribute too? If you do, I'd also take that into the equation when making your decision.

Our son is just completing a 4 yr course. He receives the min loan, so we have paid his rent for him all this time . We weren't in the position to buy anything when he first went to live there but if we had have been, we'd have received income from fellow house mates and then looked to sell the property afterwards. However, covid and lockdowns might have made it harder to find tenants, though that is due to his location and unlikely to be something you'd encounter.  Can totally see what people are saying about the experience of halls etc. My son has met his now fiancee due to sharing accommodation, starting in the first year there, which wouldn't have happened otherwise.  

Sistergold

How about investing the money elsewhere and using returns to pay your daughter’s rent. Seeing you want to buy in London it must be a good amount? It’s important to give her the freedoms to move freely into their own choice of accommodation with her friends rather than tie her to a particular location. 

Owleyes00

I lived in a house owned by a housemate’s parent and tbh the dynamic was weird. What was even weirder was our heating broke in January second year and her dad didn’t get it fixed until April but I digress. Better to just rent somewhere like everyone else and not have the various power issues at play and have a normal university experience - wish I had!

dimbo61

Living in London is expensive ?
Renting in London is expensive?
Buying and Selling a property after 4/5 years of ownership may make you ( your daughter ) a huge profit IF property prices rise or you might lose money if prices drop or remain stagnant ?
Who knows !
Part of the student experience is renting with others and learning to work together and pay bills, sort council tax exemption.
I am a HMO student Landlord and not all LL,s are rubbish and awful student accommodation.
It can be hard work looking after student properties