The dominance of high-tariff universities in recruitment, rising numbers of commuter students, concerns over course closures and an upcoming demographic decline are contributing to a period of “ultra-volatility” in the UK student housing market, according to experts.
Elite institutions have responded to financial pressures by recruiting more undergraduate students than ever before, which is being replicated in demand for housing, according to Lizzie Beagley, head of purpose-built student accommodation (PBSA) and co-living investment at estate agent Savills.
The sector has seen a “turbulent” start to the year and faces an emerging “threat” from students continuing to live at their family home and commuting to university but remains attractive to investors because of a persistent supply-demand imbalance,?rising rents,?and the UK’s stellar international reputation, she said.
“I think we’re lucky in that the supply-demand ratio and imbalance are so compelling that we can manage to digest these changes. [But] I think the glory days of building and building have definitely softened.”
Darren Smith, professor of geography at Loughborough University, said some areas have seen an exodus of students, but others – the “quintessential studentified areas” like Manchester – have become?more concentrated than last year.
“The flow of students into city centres is accelerating, and I think it’s going to continue to accelerate going forward.”
And amid course closures and mergers, which can have significant impacts on accommodation demand and student composition, Smith said the UK was in an “ultra-volatile moment in time” for developers.
“They’re going to have to keep a very careful eye on how particularly universities respond to particular crises and challenges going forward. I think it’s very complex, complicated terrain at the moment to try and predict what’s going to happen.”
Richard Ward, head of research at lettings company StuRents, said undergraduate demand is expected to continue to rise, but volatility in the postgraduate market has created added uncertainty.
“London, Bristol, Glasgow and Edinburgh are examples of cities where demand has been strong in recent years due to cultural prestige and world-class universities, although 2025 has been more challenging for some.
“In contrast, some markets such as Nottingham have seen an influx in new PBSA, which hasn’t been met with adequate demand growth.”
Figures from StuRents show that just under 17,000 PBSA beds have been delivered in 2025 – 35 per cent more than last year. This was the largest annual rise of the past decade, but total beds remain at their third-lowest level of that period.
“The result is likely to be mounting pressure on student budgets with little or no increase in the availability of affordable accommodation,” Ward said.
Despite the prevalence of PBSAs in the UK, Phil Hubbard, professor of urban studies at King’s College London, said research showed that houses of multiple occupation (HMOs) were the preferred option for students.
“Most students want to live together with other people in a good-quality HMO. PBSAs are, in some cases, an expensive option that some students are forced to take rather than one they want to take.”
An application to build the tallest building in Nottingham was recently turned down by the council.
The owners of a large PBSA accommodation in Coventry recently applied for a change of use to allow non-students in amid high vacancy rates. And Hubbard said this may become increasingly common, particularly?if the vital Chinese market starts to decline.
“The PBSAs that are coming online often are predicated on quite an expensive, exclusive product, and that’s not what necessarily the domestic market is looking for. If the overseas market starts to dip…oversupply might be an issue in a lot of cities.”
With such a “massive” pipeline of PBSAs, he warned that this will become an even bigger problem in five to 10 years when the number of domestic students begins to fall.
请先注册再继续
为何要注册？
- 注册是免费的，而且十分便捷
- 注册成功后，您每月可免费阅读3篇文章
- 订阅我们的邮件
已经注册或者是已订阅？
