Finger on the Pulse: 5 Key Trends on Student Living for Academic Year 2023/24
In collaboration with EAIE, this article spots student mobility trends from EAIE's admission report and our own data and creates a list of things to look out for this coming academic year of 23/24
Another academic year is coming up, and with it we see millions of students, both domestic and international, moving within or to Europe to pursue an exciting new chapter in their lives. Over the last three years, The Class Foundation has collaborated closely with European Association of International Education (EAIE) and StudyPortals to explore what trends we see every academic year; EAIE looks into the admissions side, StudyPortal with student trends (such as mobility etc) and the Class with all things to associated with student living. Here are our, according to us, top 5 aspects to note on student Living for the academic year 2023/24.
- Operators see the need for more collaboration with the universities
The Class collected data from our network of operators over the three years largely note that they are not informed about their neighboring universities’ plans to expand and over 80% said they were not informed regarding an increase in applications. This is congruent with similar reports, such as in the UK, where data from UCAS shows that university recruitment, have increased 65% to 562,000 since 2000, which has severely outpaced the development of new student beds, thus reiterating the need for stronger collaboration between universities and housing providers to find solutions together to bridge the demand gap [Financial Times].
- Unlike a majority of universities, operators report that housing availability is a major mobility challenge for students
For many of The Class student housing operators, “lack of available housing” ranked second in terms of being a key concern for students according to our data. This is in contradiction to the survey by EAIE, which shows the greatest proportion of universities saying that housing availability is only a minor challenge.
Rising demand and the restricted supply growth are likely to hit struggling domestic/international students the hardest, as they already have limited options to chose from. Thus, universities should pay attention to this aspect which can potentially restrict their student enrollment pool, which is diverse and equitable. As seen in the Netherlands, The Dutch Ministry in December 2022 asked universities to stop actively recruiting international students due to lack of housing being one of the main issues, which has received push back from the universities [University World News]. We must take the Dutch case as a cautionary tale and ensure that insufficient housing doesn’t impact mobility and access to education in students’ preferred place of study.
- Under supply of housing in all markets
According to various data insights, almost every major student housing market shows a massive gap between the number of students and the number of bedspaces available. For example, below, is a snapshot provided by Class Partner Savills during their presentation on French PBSA forum in February.
If we dive into key markets, we see:
If university students continue to rise whilst the supply of new student housing continues to slow down, by 2025, the UK will face a shortfall of approximately 450,000 student beds, according to the latest data from StuRents – the country’s largest portal for student accommodation [PBSA news]. Based on The Class conversations with trend watchers in the UK, by the end of the decade, most students would want to live in PBSA but currently only 12% of students live in PBSA. So the assumption is most students will go to local universities and live at home if supply and demand are not met.
In the 2021/22 academic year for the Netherlands, the National Student Housing Monitor estimated there was a shortfall of 26,500 rooms for college and university students in the Netherlands and expected similar numbers for 2022/23. In the 2022 fall semester, 35,000 students from Germany were unable to find housing [Schengenvisa.info]. According to this Q2 2022 Savills report In Italy, the provision rate was only 4%, meaning a gap of around 253,000+ beds [savills]. In a nutshell, all the reports essentially highlight a decreased pipeline of beds although it has been heavily discussed amoing investors that PBSAs are a low risk asset class.
- Cost of living concerns continue to plague students
EAIE’s report shows that the largest proportion of university respondents believe cost of living and inflation to be a moderate problem for student mobility. This is not entirely aligned with our data from our survey this year and past years, where affordability is consistently ranked in the among the key concerns for students according to operators.
Inflation plays a major part in making securing affordable housing more difficult. In the UK, due to inflation and supply and demand pressures, Cushman & Wakefield estimated rents in private student housing had risen 19.3%, and rents from universities by 14.5% in 2022 compared to 2016-17 [Financial Times]. Further, with the government freezing student loans, an average student spends 88% in London, leaving students with just GBP 38 per week (Accommodation Cost survey 2022-2023). SchengenVisaInfo.com reports that rents across Germany have increased by 6% in 2022 compared to 2021, with Munich and Berlin taking their place among the most expensive cities for students [ICEF Monitor]. In italy, we see students protesting rent hikes [The Guardian]. These are examples of how all major markets are showing a similar trend; as demands for PBSA increase and supply falls, the rent prices unsurprisingly go up, living students with little financial flexibility to spend on other essentials.
- International students numbers on the rise across Europe
Similar to the 2023 EAIE International Admissions Report, The Class through it’s annual demand survey, market insights received from it’s partners and in discussions from the Student Living Forums, also finds that numbers of international students are on the raise steadily across Europe. In the Netherlands, in the 2021/22 academic year, 115,000 students came from abroad which is a 9% increase from the year before. The number of international students have also steadily increased year-on-year even through the pandemic. The UK hit a record number of students in 2022, with study visa grants reaching around 490,000 in number, a 29 % increase over the year before (2021), and an 81% increase from pre-pandemic levels (2019) [ICEF Monitor] [Times Higher Education]. In Italy, 2022 saw 110,000 international students which was a 14.5% increase from 2019 / 2020 [Cushman & Wakefield] [statista]. In Spain, in a period of five years, the number of international student enrollment has increased significantly, by 36% —from 153,193 to 208,366 students [Erudera]. By 2024, over 500 European universities will participate in Eramus+ programme [Erasmus+]. With the rise in mobility, we must note that every student needs a safe and secure place to call home be it for weeks, months or years. Therefore, The Class endorses not just more (quality and affordable) homes for students but also flexible renting tenures.
Affordability and accessibility to housing is a major concern for students, which universities, and city leaders must be aware of so as to support students in whichever possible ways they can otherwise, this is likely to impact admissions and mobility in the future.
While it is encouraging to see internationalisation of higher education being endorsed across Europe, it is creating further pressure on already undersupplied student housing sector in European markets. The lack of affordable and accessible housing is a serious concern which can eventually impact student mobility numbers in the near future. As the chasm between rising demand for student housing and undersupply continues to grow, The Class endorses universities and student housing providers to work closely together to be able to provide accessible quality accommodation to students and create long term strategies that benefit all stakeholders.