StuRents recently hosted its second Summit at The Pelligon in London, where it launched the latest Occupancy & OpEx report. The event gathered over 200 industry experts, including institutional investors, lenders, developers and operators from purpose-built student accommodation (PBSA), houses in multiple occupation (HMO) and Build to Rent sectors.
New analysis revealed the UK student accommodation sector is undergoing strategic recalibration, with PBSA studio booking rates down from 58% to 44.2% year-on-year. However, underlying fundamentals remain robust in well-positioned markets while the HMO sector achieved over 5% rental growth.
Panelists spoke candidly about the market becoming ‘more challenging than in recent memory’, with a stark 50/50 split between outperforming and underperforming assets, revealing accelerating market polarisation.
The data revealed extreme regional variations in performance, with the best-performing city achieving 51% booking rates compared to 29% in the worst.
Nottingham exemplified the challenges facing oversupplied markets, with its end-of-year position (as of November 2024) falling from 96% to 87% year-on-year and rents beginning to decline as supply growth outstrips demand. Leicester showcased resilient market fundamentals, with demand continuing to track above supply growth and stable leasing velocity, demonstrating that well chosen locations remain attractive investment propositions.
Panellists at the Summit revealed students don’t necessarily distinguish between PBSA and Build to Rent but rather gravitate towards brands that offer flexibility, strong support services and represent value for money. This results in Build to Rent developments attracting students seeking flexible tenancy lengths, pet-friendly policies, and couple accommodation options, particularly international students.
Students are also being drawn to Build to Rent amenities, such as in-room washer/dryer facilities and independent living options – a trend driving PBSA operators to reconsider their services and spurring product innovation. At the same time, some Build to Rent schemes have shown an ability to reduce their exposure to students, who are not their core tenant base, offering a silver lining to PBSA.
The HMO sector demonstrates particularly robust fundamentals, with 77% of British students choosing HMO accommodation over PBSA and the sector achieving rental growth above 5%.
It has benefited from the addition of 160,000 UK undergraduates since 2016, creating a substantial and growing domestic market. With HMO rents showing consistent upward trends, the sector offers stronger rental growth prospects.
StuRent’s data revealed that domestic demand drivers are strong with positive long-term demographic trends supporting continued demand growth, while additional affordable supply remains constrained.
The upcoming Renters’ Rights Bill might reshape HMO letting patterns, potentially creating opportunities for PBSA operators to capture early domestic demand, which could be forced into a later HMO lettings cycle.
Industry figures noted this could ‘profoundly shift the seasonality in the HMO market’ and might enable PBSA developments to ‘specifically target domestic demand’ displaced from traditional HMO booking windows. However, the price gap between PBSA and HMOs is still so wide, and doesn’t tend to cater to the average domestic student’s search budget.
StuRent’s analysis highlighted how superior market intelligence is becoming a key competitive differentiator, with the research demonstrating how different methodological approaches can produce varying market conclusions for the same market.
“The same market could show four completely different supply and demand conclusions depending on the methodology used. For example, in Nottingham, one approach shows a student-to-bed ratio of 1.7 suggesting massive undersupply, whilst our ‘core demand’ methodology – looking at first year British students living away from home and international students – showed the completely opposite conclusion with supply growth actually outstripping demand growth.
“If you have access to high-quality, truly independent data that can be used to identify opportunities you will be at an advantage, whilst those that don’t have access to that will be exposed to risks.”
Richard Ward, Head of Research, StuRents,
High-quality, real-time data is a competitive advantage for identifying pricing and demand opportunities, but it is equally as important to ensure businesses have the correct resources and industry-savvy teams to effectively interpret the data. Human oversight remains essential but should leverage tools like Concurrent’s reporting API, PowerBI, HubSpot, and other AI tools to make informed business decisions.
Industry leaders remain optimistic about sector fundamentals, particularly for operators with strong market intelligence and strategic positioning.
“The past two years have spoiled us with pent-up demand, so we need to recalibrate, and operators will have to work harder to let their buildings. As investors, we have become more selective – we know exactly what cities we want to be in and which micro-locations work. Historically, PBSA was 10% to 15% of our book, but now it’s 40% because we like the sector, particularly on the debt side.”
Sky Mapson, Director, Maslow Capital
Despite market challenges, live polling at the summit revealed continued investor appetite, with 80% of attendees actively seeking new investment opportunities and 48% reporting that international student demand hasn’t changed for their portfolios in 2025 so far.
The demographic outlook remains positive, with international student demand expected to continue supporting the sector, particularly in markets with strong university partnerships and appropriate pricing strategies.
StuRent’s analysis emphasised that forward-looking market analysis has become more important than ever for identifying the significant opportunities available to inform market participants.
