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Student Accommodation Research: More Than 31k PBSA Beds Confirmed for 2019-20

Posted by Richard Ward in ,

Image courtesy of Flickr, Creative Commons

The supply of purpose-built student accommodation (PBSA) across the UK continues to increase, with more than 31,000 new bed spaces already confirmed for the 2019-20 academic year. If beds continued to be added at their current rate, then it is likely we will surpass the 32,652 added to the market in 2018.

Whilst this new PBSA represents modest year-on-year growth of 4.9%, it masks what are significant differences at a locational level.

For example, last year more than 3,000 PBSA beds were added to the market in Sheffield, representing growth of 14.4%, whilst a further 2,941 beds have already been confirmed for 2019, leading to an increase of at least 12.0% year-on-year. In comparison, full-time non-UK domiciled students in Sheffield grew by just 3.9% in 2017, as recorded by HESA.

Figure 1: Growth in PBSA by location

PBSA Growth

Source: StuRents.com

On average PBSA outside of London commands a rental premium to HMOs of over 40%, which represents a substantial outlay, especially for typically cash-strapped domestic students.

In these markets where the premium to HMOs is significant, UK domiciled students may not find PBSA a financially viable option. Moreover, market commentators often analyse supply in isolation, choosing to focus entirely on PBSA but in most university towns and cities supply is still dominated by Houses in Multiple Occupation (HMOs).

It can, therefore, be argued that in locations where supply is increasing at a faster rate than demand, new PBSA is leading to a deterioration in market fundamentals and anecdotally this is already the case in several markets.

As the student accommodation sector continues to mature and additional supply is added, it is becoming more important than that ever stakeholders have access to the most comprehensive data available, leading to more informed decisions.

StuRents lists in excess of 750,000 student beds nationwide, covering both the HMO and PBSA sector. To understand more about our market-leading insights and data services visit: StuRents.com/student-property-research