New research from Cushman & Wakefield has revealed record-breaking numbers of student beds delivered for the 2018/19 academic year as the UK student accommodation market continued to flourish despite the growing uncertainty of Brexit.
According to data revealed in Cushman & Wakefield’s ‘UK Student Accommodation Report 2018/19, there were 31,348 new beds delivered during the academic year, bringing the total of purpose-built spaces to a record 627,115.
2019 is expected to see the student accommodation market continue its resilient growth with a further 36,000 new rooms entering the market.
New data reveals that the private sector has grown 130% in four years and now controls over half the markets supply; overseas investors have continued to dominate the market, accounting for 58% of 2018’s transactions.
Along with overseas investment Cushman & Wakefield’s report reveals that there has been a staggering 215% rise in the number of international (non EU) students attending UK universities since 1999/00; no doubt spurred by the weakened Sterling, there are now over 285,000 students from outside the UK – nearly one quarter of the entire student population.
David Feeney, UK Student Accommodation Advisory at Cushman & Wakefield, commented: “The student accommodation market shows no sign of decelerating with another record-breaking year of student bed-space provision in 2018. Even with the uncertainty caused by Brexit, we don’t expect the UK to become any less venerated as a top location for study and predict the upward trend to continue in 2019.
“Students are increasingly discerning when they select a university, and the quality of amenity spaces is more important than ever to the success of schemes. With the private sector tendency towards individual rooms and amenity quality, there is a real opportunity for developers to meet increasing demand, in a market where students are not just weighing up the quality of their course, but the quality of facilities too.
“Over the coming year, we will see more re-provisioning of bed spaces into high-grade communal spaces and an increasing number of private-university partnerships to achieve outstanding living spaces for students close to academic buildings.”
Despite the rising numbers of rooms available and spaces available, there remains an underlying problem in many regions of the UK including both London and Bristol where many feel priced out of the market.
Data from Cushman & Wakefield reveals that average rents on a typical 42-week lease stand at 70% of the maximum Student Maintenance Loan.
While the spiralling rental rates haven’t deterred international students – whom of which have seen a 13% increase in London since 2012/13-, there has been a drastic contrast in the low levels of growth for UK citizen full-time students in the capital (only 1.4% over the same period) – a figure that falls far below the national average of 8% for UK full-time students.
In Bristol, there were 15,993 purpose-built student accommodation bed spaces for the 2018/19 academic year, a figure that marked a 4.2% increase from the previous year.
However, the weekly average rent in Bristol is £177, making the city one of the UK’s most expensive outside of London. David Feeny noted that: “There are growing concerns about the impact of a burgeoning student body on the city’s Council Tax base, with losses of £1.6 million forecast for the coming year due to student exemptions. With likely increases in student numbers in the coming years, concerns over the impact of Bristol’s student population on the local housing market are likely to continue.”
Featured Image Credit O.F.E