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As Students Flood to Universities - What Opportunities Are There For Landlords?

Peter Hemple looks at the latest developments in the UK student accommodation sector

As we have reported several times before here in PIN, the 2020s will likely be a great decade for student landlords. The demographic swing, in terms of 18-year-olds leaving school and applying to go to university, has only really just begun.

According to data from the Office for National Statistics (ONS), the number of 18-year-olds each year in the UK increased from just over 700,000 in 2000 to around 830,000 in 2009. It then declined every year, bottoming out last year at just over 700,000 per year. However, between now and 2030, this number is set to rise more or less every year, peaking at almost 900,000 18-year-olds in 2030, then falling to around 850,000 in the first half of the 2030s. In short, the worst is now over for student landlords that managed to stay afloat during the recent slow and steady demographic decline in the UK.

The fact that there will be 200,000 more 18-year-olds in the UK 10 years from now is great news for student landlords. But when you also consider that the percentage of 18-year-olds that are applying to go to university in England has increased by one-third over the past 10 years, from 33% to 44% (it is currently 56% in Canada), it is easy to see how the actual number of university applications in the 2020s could really soar. According to UCAS, the number of English applicants has increased by 50,000 in the past two years alone.

The demand for university places is not just in England and there were also record rates of applications in January among students in Wales and Northern Ireland, while those in Scotland were second only to the rate recorded last year. Meanwhile, the number of applicants from disadvantaged areas has also continued to rise, with 28% of 18-year-olds from areas with the lowest educational attainment applying, compared with just under 18% in 2013.

However, applications by international students through UCAS remained flat, thanks to a continued fall in the number of students applying from the EU. Since the UK’s formal exit, students from the EU face paying higher fees and their numbers have slumped from nearly 17,000 applicants in 2019 to 10,000 this year. But some of this loss was soaked-up by stronger growth among non-EU applicants, with nearly 43,000 applications, including 12% more students from China applying for courses, making a total of 14,500.

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