Covid-19 and the UK’s Student Housing
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The coronavirus pandemic has led to an increased number of challenges for sectors across the board, creating new problems within the student housing sector specifically. This damage inflicted by the pandemic so far seems to have caused more of a dent rather than a permanent problem, a promising takeaway.
Are students renting more or less during the pandemic?
The student demographic can be split into UK nationals and international students, both providing their own challenges to the sector. International students make up roughly 20% of the total student population. Current travel restrictions and the shift to remote learning have naturally led to a fall in the number of overseas students residing in the UK for this academic cycle. As overseas students, both EU and non- EU play a vital role in sustaining this sector, a shift has been made to target the UK based student population.
Fortunately, there has not been a mass exodus of UK based students returning home. In fact a large proportion of students, freshers and particularly those who have previously been living away from home are more inclined to continue to do so, as research has proven. This comes as no surprise, living away is one of the few ways students can maintain what remains of the “university experience” and for many, their mental wellbeing.
So, what does this mean and are there long-term concerns?
Taking this into consideration, it is clear that the pandemic has posed unique challenges for the student housing sector. If home students still want to rent, what seems to be the problem? The issue here is largely the lack of flexibility regarding contracts and fees during the pandemic. Between the UK weaving in and out of national lockdowns, the overall uncertainty the pandemic brings and the challenges of adapting to online learning, the stress of paying rent for an unoccupied space is not at all appealing to students. So much so that petitions have been circulating calling for rent rebates - but that’s for another post!
For many agents, landlords and accommodations that largely cater to UK nationals, the challenges can slowly be tackled in the short term. Generally, students are looking to continue to rent and move where government guidelines allow. With the current climate, financial sensitivity towards renters and the need for flexibility as we navigate this pandemic is key.
For those that rely largely on international students, specifically the higher priced PBSAs - Purpose built student accommodation- not much can be done in the short term. With travel restrictions and remote learning, there isn’t much incentive to fork out a large sum of money to have the same experience of learning from a room, but further from home. Many of these developers may be taking a hit during this academic cycle, but will naturally begin to bounce back once the situation regarding the pandemic does and restrictions are reduced.
Understandably the sector will require some time to fully recover. However, current research reflects that there will be enough students to fill homes, flats and rooms in the future; due to the current economic climate and job prospects, the number of students enrolling for higher education degrees is expected to continue to grow. Many undergraduates are moving straight into postgraduate studies to upskill themselves and enter the job market from a more competitive stance, this includes international students, recent data published by UCAS in 2020 shows a 9% increase in non-EU international applicants. The student housing sector is a resilient one, with students lined up and worst behind us, the sector can expect to turn a corner in the 2021-22 academic cycle.