The PIE spoke to stakeholders in key destination markets to find out more.
In the UK, the year 2022 saw some Russell Group universities paying their students to defer their courses due to accommodation shortages.
For QA‘s Magdalena Restrepo, it is now about managing expectations for students – particularly those heading to London for their student experience, where availability and affordability of private short term letting is an issue, she told The PIE News.
“For students who are coming from countries with less strong currencies, the prices are too high,” Restrepo, who is senior country specialist for the Americas at QA, said.
According to Restrepo, even for students who are receiving up to 40% off the cost of their course through QA scholarships, private rental prices are still unaffordable.
Although QA offers accommodation services, it requires students to commit to a 6 month lease which is increasingly becoming the norm. Many students, unable to view the property in-person before arriving, are subsequently put off.
Desperate to find suitable accommodation, many international students are susceptible to fraud, Restrepo said – especially those who are not familiar with UK laws and standard practices. Many students from the Americas have a perception of the UK as being one of the safest places in the world, leading them to be too trusting.
“Sometimes they pay an agency, just for the agency to disappear. Sometimes they knock the door of the flat they are renting and someone else is there,” she said.
It is in the sector’s interest to ease the situation for international students as accommodation issues can easily taint a student’s overall experience, as well as their perception of the institution and study destination, she continued.
“If they have a horrible experience with accommodation, they associate it with the university and with the experience.
“Other students that have had an amazing experience with housing, they are much more tolerant to any situation that might have occurred in the university with issues such as admin for example.”
Djordy Seelmann, CEO of HousingAnywhere, suggested that solutions may lie not in rent controls but in building new accommodation. Rent controls could disincentive those looking to build new properties, he told The PIE.
“The right action is to look at how can we actually speed up the pipelines for new builds”
“The right action is to look at how can we actually speed up the pipelines for new builds,” he said.
“Sometimes it means converting existing inventory from office buildings to residential, but we have to build out in residential in many European countries to house all the people that we actually want to attract – and that’s the solution.”
Seelmann advised stakeholders to take note of the housing situation in Vienna, where he believes there is “a very balanced housing situation where city and urban planning has done very well”.
Availability of accommodation is at a record low in the major Australian study destination cities according to Thaio Tomazetti, CEO of 2Stay Accommodation Group.
“Accommodation providers are already at capacity, particularly in inner-city areas. Basically, rental stock is low, demand is high and rent prices are skyrocketing,” he explained, speaking to the PIE.
The average rent for purpose-built student accommodation increased by approximately 8% last year in and Australia last year, an analysis by BONARD found.
According to Tomazetti, this is the single biggest issue for providers and agents looking to recruit students in Australia and is “most certainly the largest issue for students themselves”.
“Usually the development pipeline is very focused in Sydney and Melbourne, but there is also a need to see the growth in other markets, like Queensland and Western Australia where study bodies are urging for the Government at all levels to step up and prioritise the development of new student accommodation.”
Tomazetti does not blame the pandemic alone for the problems – noting that political and economic reasons have further exacerbated the situation.
Looking ahead, he predicts that the recent news from China will create more challenges in accommodation availability, as Chinese authorities lifted the temporary rule allowing students to study remotely.
“China is the number one source country of international students in Australia, we understand this announcement is likely to drive further demand with tens of thousands of Chinese students expected to return this month,” he affirmed.
In January, The PIE reported that the rule would mean 40,000 Chinese students are required to travel to Australia, with semester one beginning this month.
This influx of Chinese students is expected put additional pressures on student accommodation, since Chinese students already make up 27% of all residents of purpose-built student accommodation – making them the largest cohort, closely followed by domestic Australian students.
The data, from a 2022 report released by the Student Accommodation Council – an arm of the Property Council of Australia – also showed many Australian cities were already at capacity for purpose-built student accommodation beds.
Brisbane, Perth and Adelaide were expecting zero vacancy rates in 2023, well before the Chinese government’s announcement was made.
According to data released by property advisors Savills, the supply pipeline for purpose-build student accommodation beds is muted for the next two years. It also showed that all new beds becoming available in 2024 will be located in Sydney and Melbourne.
“With students scrambling to return earlier than expected, we will see student accommodation full in many markets – which will put pressure on already tight rental markets as students look elsewhere for places to live,” said Torie Brown, executive director of the Student Accommodation Council.
“Governments at all levels need to prioritise the development of new student accommodation because it provides appropriate housing exclusively for students and stops them competing with mums and dads in the rental market.”
In May 2022, president of Higher Education Strategy Associates Alex Usher said that Canadian post-secondary institutions are “very close to the end of the road on international student number growth” – and cited accommodation as the most likely “blowback”.
David C. Dingwall, president and VC of Cape Breton University addressed housing issues in an open letter dated January 13.
The university saw its enrolment go from 3,300 students in 2018 to nearly 7,000 students in 2023, and has students from 74 countries, but recently warned international students to stay home if they have not secured housing before coming to Canada.
“Despite this, students have still arrived in Cape Breton without long-term accommodations, choosing to stay with friends or in hotel rooms temporarily while they continue their housing search. This practice is not advised by CBU.
“With students scrambling to return earlier than expected, we will see student accommodation full in many markets”
“The bottom line is that CBU needs to do more. We will double down and work even harder with governments, developers, non-profit organisations, students and others to address the housing needs of our students and, of course, assist the broader community,” Dingwall wrote.
The letter also highlighted that every official acceptance letter states that housing and employment opportunities are limited in the local area.
However, advised not to travel without accommodation, and warned not to pay a deposit for a room they have not seen, some students may find themselves in catch 22 situation.
Accommodation scams are reportedly a concern in the area as the Royal Canadian Mounted Police in Nova Scotia issued a warning in recent weeks.
“Never send a deposit until you’ve had a chance to view the place in person. Agent can’t meet you and there’s urgency to pay? That’s a sign of a scam,” it said, in a Facebook post.
It added that, as of November 30 2022, Canadians have lost $490 million to scammers.