Key PBSA sector trends to watch in 2024
Image courtesy of Adobe
As we settle into a new year, Richard Ward, Head of Research at StuRents, spoke to PBSA News to outline the key trends to look out for in the UK PBSA sector. These fall under three key headlines:
Supply growth will remain limited
In 2023, just 12,000 new beds were delivered, down from 36,000 in 2019. This is a result of a broader slowdown in planning as well as rising construction and debt costs. PBSA is now predominantly being delivered by the private sector, meaning universities are set to remain increasingly reliant on private operators to house students.
The affordability of student accommodation is also set to remain an issue this year. While domestic students are struggling with the increasing cost of living, the annual maintenance loan increase was not significant enough to offer much assistance. However, the PBSA sector should be wary of becoming over-reliant on international students to fill beds. Although the latest UCAS figures show a fall in the acceptance of non-EU admissions, the long-term trend remains positive.
Planning applications will rebound
Following a low level of planning activity in 2023, the market should be set to see a rebound in planning applications for 2024 as the imbalance between supply and demand drives new activity. However, this may not immediately translate into an increase in approvals.
Rental growth will remain strong
In 2023, the average cost of PBSA per person per week saw a year-on-year increase of 10.1%. Growth is expected to remain strong in 2024, with more than 60% of participants in our recent StuRents webinar anticipating a rental growth of between 5% and 9.9% for 2024-25.
This rental growth does pose a risk to the PBSA market in terms of future demand. If rental growth escalates too much then there could come a point when the majority of students just will not be able to afford rental prices. This could result in some demographics being priced out of more expensive cities like Bristol, Bath and Edinburgh.
To avoid rising rents acting as a deterrent to higher education altogether, PBSA operators need to work closely with universities to ensure that they meet the needs of students.
Read all of Richard Ward's insights and predictions for 2024 on PBSA News.
Share
Article by
Copywriter & Content Marketing Executive at StuRents
Honor is a Copywriter & Content Marketing Executive, working within the Marketing team to create content for StuRents.
