The UK’s Purpose-Built Student Accommodation (PBSA) sector is continuing to go from strength to strength, according to Savills. A shortage of supply combined with rising student numbers has resulted in strong rental performance, with over 7% growth forecast for 2023/24.

The latest UCAS application data reveals that the number of students starting their undergraduate degree has topped 600,000 for the second year in a row – with 618,000 starting in 2022/23 and 622,000 in 2023/24. This equates to a first year cohort larger than the population of Sheffield looking for accommodation each year.

Even more growth in demand is expected, with UCAS projecting that the UK could reach 1m university applicants in 2030, which will place existing PBSA stock under even greater pressure.

“The UK remains one of the key global destinations for students looking to study abroad. There are currently more than 600,000 full-time international students, up from just over 400,000 five years ago, according to figures from HESA. While there has been a fall in EU students in the wake of Brexit, this has been more than offset by significant growth in the number of students from India, as well as continued strong numbers from China and elsewhere,” says James Hanmer, head of UK PBSA Investment and Co-living, in the Operational Capital Markets division at Savills.

“We know that strong application figures from these countries are a huge positive for PBSA demand: international students are 60% more likely to live in PBSA than domestic students, with those from India more than twice as likely.”