A new survey conducted by global property consultancy Knight Frank in partnership with UCAS reveals that the availability and affordability of student accommodation are playing a more critical role than ever in students’ university choices. As rising costs and supply shortages challenge universities and developers, the survey offers key insights into how the Purpose-Built Student Accommodation (PBSA) sector is adapting.
Accommodation influencing university decisions
Now in its fifth year, the annual Student Accommodation Survey, which surveyed university applicants and current students across the UK, highlights the growing impact of accommodation on students’ decisions. A striking 65% of first-time university applicants revealed that the availability of suitable accommodation influenced their choice of institution.
Neil Armstrong, Joint Head of Student Property at Knight Frank, commented, “It’s clear that accommodation plays a critical role in students’ decision-making, both before and during their studies.” He added that purpose-built housing not only enhances the student experience but also helps manage living costs, as utility expenses and rents continue to rise.
The survey also reveals that 69% of students view PBSA as the more appealing choice, especially as affordability becomes a greater concern. With living costs escalating, students are seeking high-quality, affordable accommodation options that offer essential amenities and support services.
Prioritising wellbeing over luxury
The survey found that students are increasingly prioritising practical amenities and mental health services over luxury features. Fast WiFi, 24-hour security, and on-site laundrettes ranked as essential, while cinema rooms and swimming pools were considered nice-to-haves but not a necessity.
Merelina Sykes, Joint Head of Student Property at Knight Frank, noted, “This year’s survey reinforces the need for student accommodation providers to focus on the essentials that impact students’ day-to-day lives. While amenities like cinema rooms and swimming pools are nice-to-haves, students overwhelmingly prefer practical, well-managed facilities.” She added that pastoral care and wellbeing services are now seen as indispensable, with 78% of students saying mental health support is an important factor in their housing choice.
Affordability concerns and future challenges
The survey also highlights the ongoing affordability challenge. With rents for PBSA rising by 7.6% in 2024, 44% of students said accommodation costs had negatively impacted their university experience. Furthermore, 88% expressed concerns about rising living costs, with many seeking additional income or financial support from parents to cover their rent and living expenses.
Katie O’Neill, Head of Student Accommodation Research at Knight Frank, who conducted the research, said, “The affordability gap continues to widen, placing additional strain on students and their families. For investors, developers, and operators, this means delivering the best possible value while also adapting to evolving student expectations, particularly around cost and support services.”
As the demand for PBSA continues to outpace supply, Knight Frank’s report calls for greater collaboration between universities and the private sector to meet growing needs. “Collaboration between the public and private sectors will be crucial in planning for growth,” O’Neill stated. She emphasised the importance of universities providing data on projected student intakes and accommodation needs to guide future developments.
The report concludes that by the end of the decade, PBSA will house the majority of second- and third-year students, creating significant opportunities for investors and developers to tap into this growing sector. As universities face financial pressures and students continue to seek affordable, high-quality housing, the PBSA market will remain a key focus for the future of student accommodation in the UK.
