Short on time? Here are the highlights:
- Nearly four higher education students are competing for every available student housing bed in London
- More broadly across the UK, last year construction was approved for less than half of the PBSA beds that were approved in 2016
- Given the relatively small number of new beds planned, and rising higher ed enrolment across the country, the shortfall in student housing is projected to exceed 600,000 beds by 2026
The UK-based property consultancy Savills estimates that there were roughly four higher education students in London for every purpose-built student bed available during the 2021/22 academic year. The consultancy says there were 344,065 undergraduate and postgraduate students in the capital city last year, but with a stock of only 91,351 PBSA spaces.
The situation is hardly unique to London, of course, or to the UK for that matter. Major study destinations around the world are struggling with limited housing supply for incoming students and the issue looms larger as we move through the current academic year.
Part of the challenge in the UK is an apparent slowdown in the construction of new PBSA housing. The housing search engine StuRents has compiled data indicating that development proposals were filed for 27,000 student housing beds in 2022, of which approvals were granted for 24,000. This compares to a recent-year peak in 2016, where more than 72,000 beds were proposed and 56,000 approved.
Speaking to The Evening Standard, Huw Forrest, head of UK student housing, living capital markets at property agent JLL said, “The acute shortage…can be attributed to various factors, including a very challenging planning environment with requirements for agreements with universities, affordable rents, along with high [municipal tax levies]. Additionally the pandemic-induced slowdown in construction coupled with build cost inflation have amplified the issue.”
Given that there is such high competition for existing PBSA stock, and that there is currently relatively little new stock being built, the stage is set for a more acute shortage in the years ahead.
In fact, StuRents data suggests that the shortage could grow from an estimated 5,000 beds in 2018 to a shortfall of more than 600,000 beds by 2026.
“A slowdown in the delivery of new PBSA, matched with rising numbers of students, is seeing students struggling to secure accommodation in cities like Glasgow and Manchester,” says Richard Ward, head of research at StuRents. “This is exacerbated by the ongoing rental crisis in the [house in multiple occupation] sector, which is seeing rents outstripping maintenance loans in many parts of the country. The situation shows no signs of letting up, with fewer beds set to come to the PBSA market over the coming years.”
For additional background, please see:
- “ICEF Accommodation: The world’s first-ever agent networking event where providers of student accommodation and related services meet with international student recruitment professionals.”
- “Netherlands making progress toward ambitious student housing target“
- “Continuing housing crunch opens the door to innovation and new strategies“
- “What if there is no room? The link between student housing and enrolment capacity“
