The Sunday Times reports that students are now reluctant to accept lower standards of accommodation, and are instead looking for luxury housing with facilities such as gym access and parking.
The supply of student accommodation is failing to keep pace with rising demand. According to StuRents' data, this lack of supply has raised students' rents by more than 10% this year. There is now an estimated shortfall of 490,000 beds by 2026. As more students are taking on debt to pay for tuition and accommodation, they seem to have become more reluctant to accept poor-quality housing, preferring to invest their money into more 'luxury' digs.
Despite the growth in demand, landlords appear to be leaving the student accommodation sector. Listings for student housing by private landlords have fallen by 45% since 2019. This is perhaps in part due to the fact that, since 2018, landlords have needed HMO licences to let property where five or more people from at least two different households live. These licences cost about £1,000 every five years.
This mass migration of landlords leaves an opportunity open for developers to invest in student housing projects or buy property directly.
Find out more about the risks and opportunities involved on The Sunday Times.