August 9th, 2016Student Accommodation News
As the new academic year approaches at speed, Universities across the land are facing new and increasing challenges.
The removal of grants for students starting their courses this year is set to have an effect on university applications. Funding for poorer students has been, until now, largely absorbed by government grants awarded to students from a low-income background. In the most recent budget, however, the former Chancellor of the Exchequer, George Osborne MP, declared these grants would be abolished and replaced by loans which must be repaid.
The second and most challenging prospect, perhaps, is that the UK has voted to leave the EU and, with negotiations not even started as of yet, it has left a confusing situation in its wake for both universities and prospective students. As many are keen to point out, European students currently enjoy many of the same rights as UK students and are able to take advantage of the student finance system in very much the same way that British students can. It has not been made clear at this point what restrictions would or would not apply to EU students wanting to study in this country or whether they would need a visa. Furthermore no decision or indication has been provided towards the student finance status of these applicants.
Despite these challenges, a total 674,890 people applied to full-time courses in UK higher education by the 30th June deadline this year. This is an increase of 1,850 applicants compared to this point in the last cycle, giving an overall percentage increase of approximately 0%. Of these applicants, 553,740 people applied from the UK, an increase of 150 on this point in 2015. The number of EU applicants rose by 6% (+2,920) to 51,850. The number of applicants from outside the EU decreased by 2% (-1,230) to 69,300.
This tells an interesting story and as far as we can see this year there will still be a large influx of home-grown and EU resident students but we will not know the full impact of Brexit until next year’s application figures are registered.
One thing is for sure is that, with these increases in numbers, universities need concentrate on housing these students and as such much of their existing student housing stock will either need investment or expansion. Alternatively the likes of Liverpool, Manchester and Leeds are encouraging big private investment in to their immediate housing areas.
This has provided much-needed housing solutions as universities have been reluctant to plough large amounts of money in to largely decaying estates. The competition from boutique student accommodation so far has meant that the majority prefer to spend their money on better quality housing. This has been fuelled by private investors who have been reluctant to place their money in other riskier areas of the economy but have found strong and safe returns in student accommodation.
Certainly the demand is increasing and the financial performance of student housing is attractive due to strong tenancy rates and the added benefit of professional management companies who are able to provide the investors a ‘hands-off’ investment. As these properties increase in popularity we can be sure that investment too will increase.
Universities across the land may face increasing challenges as time goes on but if recent figures and performance are anything to go by then they will rise to the challenge and continue to be the envy of the world.