Delivery of New Student Beds Failing to Match Demand

Following the publication of StuRents' 2023 Annual Report, Property Reporter comments on the projected worsening of the supply vs demand imbalance in the student accommodation sector.

According to research from StuRents, planning activity in the UK remains at relatively low levels. In the first 8 months of 2023, applications totalling 27,000 beds were put forward, but only 13,000 were approved. By contrast, during the same period in 2018, 37,000 units were proposed, and 33,000 were approved. As a result, there has been a natural decrease in the number of projects, with only 12,000 beds projected for the 2023-24 academic year.

As construction costs remain high, and the cost of debt is elevated, developers have been focusing on providing studios to make schemes viable.

Furthermore, students are beginning their accommodation search earlier than ever, with the 2024-25 season already underway in some cities. 

Head of Research at StuRents, Richard Ward, states, 'This trend is no doubt a reaction to both the local and national press, with recent stories highlighting the challenges students have faced in finding suitable accommodation. For operators, this can result in further operational challenges if prospective tenants decide they want to drop out of their previously signed tenancy agreement before it starts'.

Read more on Property Reporter.