Brexit and Covid impact
Housing demand from EU students slumps by half
Student accommodation demands have been affected by Brexit and Covid
Demand for student accommodation from EU students has slumped by more than half, according to Unite Students.
The UK’s biggest owner, manager and developer of student accommodation said international travel restrictions are also having an effect on demand from China, where record numbers of new undergraduate students have not yet translated into bookings.
On the upside, there has been record demand for UK universities from UK school leavers and non-EU students, though this has not offset declines elsewhere.
Latest UCAS data shows a total of 508,000 students placed at UK universities for the 2021/22 academic year, 1.6% below the same stage in 2020/21.
The number of placed students from the UK increased by 1.4%, driven by a record entry rate for UK 18 year olds (37.9%). Non-EU student numbers have increased by 5% but this has been more than offset by a 56% reduction in EU students impacted by Brexit and Covid-19 travel restrictions.
The company said 94% of bed spaces are now let across its total portfolio (2020/21: 88%, 2019/20: 98%), slightly below management’s previous expectations for 95-98% occupancy.
A record level of university applications has not translated into higher student intake as expected.
“We are sold out in the majority of our markets with significant waiting lists in a number of key cities for students struggling to find suitable accommodation,” said the company in a statement.
“However, we have seen a concentration of voids in cities where we expect universities to have lost market share of students or which are adjusting to new supply.”
Richard Smith, chief executive of Unite Students, commented : “We have seen record demand for UK universities from UK school leavers and non-EU students, particularly for the strongest universities to which we are strategically aligned, although higher grade attainment and restrictions around international travel as a result of the pandemic have impacted occupancy in a small number of cities.
“There remains a strong outlook for student demand driven by demographic growth, rising participation rates and increasing demand from non-EU markets.
“This underpins our confidence in a rapid recovery in earnings and total returns, driven by sustainable rental growth, our substantial development pipeline and further opportunities to deploy capital.”