Rich students rent a third of prime London homes

Wealthy foreign students rent almost a third of homes in prime central London locations, according to research by property investor LCP.

Overseas students account for 29% of the private rented market in the areas of City of Westminster and the Royal Borough of Kensington and Chelsea, up from 12% in 2006.

In Westminster alone there are 75,000 to 100,000 students, almost half of the total resident population of 250,000.

Westminster students pay an average rent of £28,878 a year, according to the LCP research.

LCP warned that government policies to reduce the level of immigration to the UK may impact on the number of overseas students moving to London and consequently damage the high-end residential market.

The growth in student demand for prime London properties has made up for marginal growth in demand from other quarters – the number of finance professional tenants in prime London homes has grown by just 3% since 2006, to 37% of the total.

Naomi Heaton, chief executive of LCP, said: “Foreigners are attracted to prime London central as a financial centre, a ‘go to’ destination and as a premier league provider of education. 

“Alongside the aspiration for a great British education, there has been a significant appetite to invest in ‘bricks and mortar’.

“Recent changes to the immigration rules could send these students, and with them significant international wealth and investment, elsewhere.”