From an international perspective, UK institutions consistently rank among the world’s best. At the same time, the number of 18-year-olds in the UK is forecast to grow by approximately 20% by 2030. The number of UK students going to university is rising and this trend is anticipated to continue. The pressure on existing stock also shows no signs of abating, as the number of university applicants is anticipated to increase over the next decade, driven by both domestic and foreign sources. The rise in student numbers from China and India, in particular, is helping to fill the void created by their absence. This is despite the UK’s exit from the EU, which caused a fall in the number of EU students seeking to study in the UK. This was approximately 8.5% higher than in 2019, according to UCAS data. Applications reached their highest level in 2022, with over 760,000 undergraduate applications to UK universities. This has placed significant pressure on existing supply, with the under provision of first-year accommodation forcing some students to seek housing in other cities, or to defer their places. Student numbers are risingĪs the number of students enrolling in UK universities has increased, so too has the demand for student accommodation. However, the outlook for the sector is more nuanced than many appreciate and there are a number of factors to consider before investors target this alternative asset class. They are attracted to the strong demographic and structural trends that support longer-term growth in UK student accommodation demand. Indeed, it has proven more resilient than first imagined and many investors are now actively pursuing the sector. Despite the pandemic-induced shock that had many spelling the end of student accommodation as we know it, the sector has bounced back dramatically.
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