April 25th, 2016Student Accommodation News
The Guardian, The National Union of Students (NUS) and other media outlets have recently been reporting that students are increasingly struggling to find adequate university-provided accommodation, as rental prices rise and quality drops.
As acceptance letters are being received across the country the 2016 crop of students are facing housing issues unlike any of those before them, with universities increasingly offering inadequate first year housing at increasingly unaffordable rates. Most of the housing stocks owned by the education establishments are lacking in investment and adequate facilities it has been claimed. It appears that the issue being faced by students is that the universities are still charging rates similar to the boutique living accommodations being offered by private developers for far inferior living spaces.
Students entering halls can expect their weekly rent to be anywhere between £80 and £150 depending on the location of their studies. The NUS argues that the money being charged by these establishments simply isn’t representative of the service being offered. Students going into house shares in second and third years are frequently finding astronomical rents and shockingly poor conditions by individual landlords.
Despite the student housing issue reaching crisis level, universities do still expect record levels of applications and acceptances for students want to study this year. The removal of the cap on student numbers has meant the number of undergraduates who are looking for accommodation has reached record levels this year.
Student numbers are expected to continue rising though it is anticipated that many poorer students may be put off from next year, when the maintenance grant is replaced by a loan.
The lower-cost rooms available from education institutions have got much more expensive, rising 23% in price since the academic year 2009-10, according to Unipol. This means some institutions no longer have any low-cost rooms for their poorer students.The answer it seems then lies in private investment, with universities unable or unwilling to improve their housing stock and unwilling to provide more affordable rents. Private investment in student accommodation has sky rocketed in recent years as students are more willing to pay a premium for luxury housing and investors enjoy superb returns from an ever increasing market.
As investors see increasing value in student accommodation investments and more accommodations appear in city centers across the UK the one concern for students and investors alike has often been how students will maintain their lifestyles as living costs and rentals increase.
It was announced by the government last year that maintenance loans are to be scrapped and replaced with loans instead, leading some to worry that poorer students may be discouraged from applying but a spokesperson for the Department for Business, Innovation and Skills said: “The government is committed to widening access to higher education and anyone with the ability to succeed should have the opportunity to participate, regardless of their background or ability to pay. Following changes announced in the budget, we will be providing students with more money in their pockets than ever before to help with living costs while studying.”
Today, student accommodation in the UK is big business. According to the estate agent Savills, £5.8bn was pumped into the market last year, and private developments continue to spring up on prime city-center sites.
One thing is for sure though, it’s not putting students or investors off as demand continues and yields continue to return profit at an impressive rate. It’s a topic that is sure to be debated at length, but with students receiving more support to maintain living standards, it’s hard to see why a market brimming with competition wouldn’t invite students to seek out the best accommodation on offer by private developers.