The latest figures from Stripe Property Group show that the current market size of the PBSA sector is an estimated £3.971bn, having increased by 67% in the last decade from £2.4bn in 2013.
After the market size of the sector reached its lowest levels since 2016 due to in-person studying being restricted by the pandemic, the PBSA sector had peaked to its highest point in 2020, with an estimated value of £4.1bn.
However, as the impact of the pandemic took hold, the market size of the sector plummeted by -21% in a single year to £3.2bn in 2021.
With the sector bouncing back in 2022, with the estimated market size increasing by 23%, although it remains 4% below its pre-pandemic peak.
The latest forecast from Stripe suggests that the pandemic impact could now be over, with the PBSA sector predicted to hit £4.2bn in market size in 2023; an annual increase of 6% and 2% above its pre-pandemic peak.
“While pandemic restrictions were problematic for many areas of the UK property market, the PBSA sector was hit particularly hard by the almost immediate reduction in demand for student housing, as higher education was no longer pursued in a physical format. This brought about a notable reduction to the market size of the sector and we’re still feeling the impact of this downturn today. However, we are heading in the right direction and we predict that the impact of the pandemic will be nothing more than a memory by the end of this year. The returning health of the PBSA sector has been driven by a return to normality for many students and purpose-built student accommodation is once again in very high demand. We’ve seen the stories around the shortage of suitable accommodation to meet demand and so the vital role played by the PBSA sector is only going to grow in importance as the years go on.”James Forrester, Managing Director, Stripe Property Group
More recently, the sector has bounced back from the pandemic decline and predicted to reach a further 8.1% by 2025, with the total market size hitting over £4.5bn.
Earlier in the year, another study by Stripe revealed that 75% of all PBSA is taken by students at top universities.