Annual PBSA rents rose 4% this year, report finds

Average rents in purpose-built student accommodation have risen by 61% in the last 10 years, the latest Accommodation Costs Survey finds

A new report has found average annual rent for purpose-built student accommodation (PBSA) in the UK rose 4.4% this year, continuing a decade-long trend that it warns sets the market “on a collision course” with efforts to recruit students from poorer backgrounds.

That is the conclusion of the Accommodation Costs Survey 2021, jointly compiled by student housing charity Unipol and the National Union of Students (NUS).

In 2021/22, the academic year that started this September, the average annual rent for purpose-built student accommodation in the UK stood at £7,374, £309 higher than last year and equivalent to a 4.4% rise.

The new figures prompted Unipol and the NUS to warn that rent is becoming “ever-more detached from the financial support available to students”. The “current trajectory” of living costs puts residential living “on a collision course with the high numbers of less well-off people forecast to enter higher education over the next decade and a half”, the report predicts.

Today’s average PBSA rent is 16% more than in 2018/19, which, the report noted, represents “compound annual growth of 5% a year”. It means that, since 2011/12, average rents have risen by 61% overall: this equates to year-on-year rises of 4.9%.

The report also collates figures on the privately- and university-owned PBSA estates. Bed spaces in the private sector are 24% more expensive than those owned by universities – which, in cash terms, works out at £1,505 more on average per annum. This difference between average rents was 21% last year.

For a student in England studying outside London, it means average rent accounts for 72% of the maximum student maintenance loan available (£9,448). In the capital, where rents are 62% higher, rent accounts for 88% of this max loan amount – leaving a student who has no other source of income with just £38 a week for term-time expenditure. These costs are – for most students – tighter still, given that the average maintenance loan stands at £6,860.

The report said providers should do more to alleviate rent for poor students. “Similar to the figure for 2018, 89% of surveyed universities offer a hardship fund and 59% a bursary. By contrast, three-quarters of respondents from the private sector gave a nil return on lending financial support to tenants. The proportion of private operators offering bursaries has dropped from 17 to 10%,” the report said.

A range of factors means PBSA is “highly resistant to interventions to restrain rent”, the report warned: rising utility, land, staffing and building costs, as well as higher health and safety requirements following Grenfell, all work to push prices higher. “To provide assistance to those who might have difficulty affording a place in student accommodation, it now appears more realistic to target the consumer rather than the property infrastructure,” the report recommended.

In urging for more bursaries, the report said it could help prevent the “ghettoisation” of poorer students in less desirable PBSA. It says bursaries should be strengthened for poorer students and expanded to include “‘squeezed middle’ households”, with two or more children in HE concurrently.

The survey of PBSA providers found that university-owned rooms now account for 23.6% of provision – with the remaining 76.4% in the hands of private operators. University PBSA has halved since 2011/12, while private PBSA has grown by 153.9%.

The report notes that relationships between institutions and the private sector in many cases “remain patchy”. NUS and Unipol suggest universities “employ specialist staff who can make meaningful links” with private PBSAs, to maintain welfare and pastoral support.

Other findings:

  • Self-catered, en-suite rooms now account for 59% of rooms
  • Studios now represent 12% of rooms, compared to 4% in 2012/13, primarily driven by private providers in the direct-let market.
  • A drop of 18 percentage points measured since 2018/19 of universities that offer rooms adapted for students with ambulatory disabilities.
  • Thirty per cent of universities and 19% of private providers could not report that disabled students could get a room at a rent equivalent to the lowest-priced rooms.
  • Annual rent in privately-owned PBSA is £7,732 on average per annum, versus £6,227 for university-owned PBSA.

A 2019 report written by The Reverend Prof William Whyte, professor of social and architectural history, warned that the rising cost of living, impact on local communities, and design of accommodation has weakened the present student residential model.

Read more: Make student accommodation more affordable, says Hepi report

Related comment: Essential guide to The UUK Accommodation Code of Practice

Leave a Reply

Send an Invite...

Would you like to share this event with your friends and colleagues?