Student accommodation crisis deepens as demand outpaces supply
The UK's student accommodation sector is facing a deepening crisis with unprecedented demand far outstripping the available supply, research reveals.
The findings from real estate services firm Cushman & Wakefield show that demand for student accommodation across the UK has reached 1,489,110 students.
Despite this, the net increase in beds for the 2023/24 academic year was just 8,760, exacerbating the existing shortage.
This has led to a significant surge in rents, with the average private sector rent outside of London now standing at £7,632.55.
That's 77% of the current maintenance loan - and Cardiff is the cheapest place for student digs.
Students reluctant to pay premium prices
Despite a structural undersupply of student accommodation, the report states: "Students are increasingly reluctant to pay premium prices for beds."
This has led to unfilled rooms even in the most in-demand markets, due to factors such as changing demand profiles and affordability issues.
The total number of purpose-built student accommodation (PBSA) beds in the UK for the 2023/24 academic year is 718,805 - up slightly from the previous year.
The report says: "This continued decline in new bed deliveries is putting pressure on student housing markets in many large cities."
Number of new beds being delivered
The report goes on to state that the number of new beds being delivered is at its lowest level in 10 years.
Also, many older university or first-generation private sector schemes are being closed for refurbishment - but more than 3,200 beds are expected to reopen over the next two years.
However, several major student cities, including Glasgow, Manchester and Bristol, have seen no new beds added to the market.
London has only seen just over 330 new beds open.
The limited supply of new beds has contributed to rising rents and only 27 markets have seen new beds delivered.
Of those, four markets - Nottingham, Edinburgh, Leeds and Colchester - account for nearly half of all new supply.
Leeds has seen the most new openings, with 1,785 new beds for 2023/24.
Student numbers rise
Of the 170 locations tracked by Cushman & Wakefield, 23 have seen student numbers increase by more than 10,000 students since 2012/13 - while 10 have seen an increase of 5,000 or more international students.
In two of these locations, the influx of international students saw the student population grow by more than 60%.
However, not all student cities have experienced growth - 15 towns and cities have seen their overall student numbers fall by 1,000 or more over the same period.
London has seen the most significant increase in international students, with 27,495 new students enrolling in the past two years alone.
Glasgow has also experienced a notable rise, with 8,165 additional international students.
Overall, the data shows a strong trend of growth in student numbers which is driven by high-quality education and the country's reputation as a global leader in research.
Opportunities for student landlords
The managing director of Accommodation for Students, Simon Thompson, said: "The report paints a concerning picture of the UK student accommodation market.
"The combination of rising demand and insufficient supply is putting immense pressure on students and their families."
He added: "Despite the challenges, there are opportunities for student landlords and developers to address the shortage.
"However, it is imperative that policymakers, investors and developers work together to find solutions to this pressing issue of student accommodation supply."
