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Student Accommodation Update

Peter Hemple looks at the latest changes regarding the ever-expanding PBSA sector

Student property platform, StuRents, one of the largest student accommodation search platforms, with over 750,000 bed spaces listed nationwide, has analysed its own data and reported that the UK Purpose-Built Student Accommodation (PBSA) sector has grown by 5.3% this year. This is equal to more than 34,000 new beds coming to the UK market.

With a considerable supply pipeline of 120,000 beds either approved or awaiting approval, it is expected that by the end of 2020, the number of PBSA beds will surpass university-supplied accommodation for the first time. According to StuRents, this growth in PBSA beds available is coming at a timely moment as the 18-year old population in the UK, which has been declining in recent years, is set to bottom-out next year before starting to rise again.

The demographics look favourable
Mark Corver is the founder of DataHE and the former director of analysis and research at UCAS. He has stated that UK universities are not prepared for the surge in 18 year olds that will occur in the 2020s. In what he referred to as the great recruitment crisis he said that planning for filling enough places to stay viable is the preoccupation of most of the sector right now and gloom the predominant mood. However, he reported: “Universities have just had their toughest recruitment cycle ever, with total recruitment through UCAS turning lower. But the strategic dynamics are such that, rather than a managed decline, there is a pressing need for new investment.

“For UK higher education, the changing size of the 18 year-old cohort, the dominant age group served by the sector, is fundamental. We will have two more sharp falls in the 18 year-old population of around 2% – this cycle and 2020. Then the cohort grows again. This growth is strong, often 3% a year. And it is consistent, up year after year. This matters, as it makes the cumulative rises large and unrelenting. The five-year rate of population growth increases reaches 17% in the mid-2020s. Between 2020 and 2030 the population increases by 27%. This trajectory equates to almost a million extra 18 year-olds over the decade.”

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