Research by the UK’s largest student accommodation search platform – StuRents – shows lettings for the 2021-22 academic year falling by 5% year-on-year. The data, which analysed 45,000 signatories from tenancy agreements on StuRents platform between October (officially the beginning of the student lettings cycle) and February revealed that in cities such as Durham and Birmingham, the number of lettings has risen by 20% and 18% respectively, promising a healthy outlook for asset owners and investors of student accommodation in these locations. This year-on-year growth in signatories contrast based on locations – such as Bristol (-18%) and Leeds (-8%).
The previous 2020-21 lettings season was undoubtedly negatively impacted with low occupancy rates due to Covid-29 causing travel restrictions and the move to online-only teaching. This slump was particularly noticeable in the purpose-built student accommodation (PBSA) sector; however, the latest figures suggest that demand, whilst down, is holding up relatively well nationwide.
The most popular size of property or cluster has been those containing six bedrooms – which equated to 23.3% of confirmed tenancy agreements. This indicates that demand for shared living as a group of friends remains a popular choice as it provides opportunities to socialise with friends, even if only in a household bubble.
With foreign students – who typically favour PBSA – are yet to know their travel plans for the upcoming academic year, so time will tell how this segment will hold up. Typically, foreign students book their accommodation later than domestic students, so the data is incomplete. However, early indications point to PBSA capturing a smaller proportion of enquiries compared to previous years.
Large PBSA operators may therefore need to turn their attention to attracting UK students who are yet to confirm their arrangements. In locations where PBSA carries a significant premium compared to HMOs, incentives such as discounts for group bookings may be required to attract this domestic demand, with some providers already taking this route.
“Despite an unpredictable year for the student accommodation sector, we are pleased to see students are still booking their 2021-22 accommodation. The numbers are encouraging and demonstrate that there is appetite from students to return to university for either in-person class or at home studies.
“While the fate for foreign travel remains yet to be sealed, the data from the domestic market shows that certain locations have been extremely resilient.”Richard Ward, Head of Research, StuRents