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Australia aims to tackle accommodation shortage

Insufficient and costly purpose-built student accommodation may be putting Australia at a competitive disadvantage when recruiting internationally, research commissioned by the International Education Association of Australia has suggested.

Private market rent prices around inner city institutions can be equal to or more than those in some of the world’s most expensive cities

The two discussion papers, presented at IEAA’s International Student Accommodation Symposium, were commissioned as a result of concerns raised by the Council of International Students of Australia about the quality and affordability of student accommodation for international students.

“International students are generally very satisfied, but living costs and affordability are areas of concern”

“International students are generally very satisfied with their study experience in Australia, but living costs and affordability are areas of concern,” states one report.

A lack of university-provided accommodation is one of the key issues raised in two discussion papers carried out by commercial property firm JLL, which looked at domestic accommodation provision as well as providing a comparison with offerings in the UK, US, Canada, Singapore, Hong Kong and Malaysia.

The shortage of university accommodation means that international students in Australia are much more dependent on the private rental sector than in other countries, while institutions lose out on opportunities to attract students through university-managed accommodation.

For example, Swinburne University provides just seven beds per 1,000 students, while the University of New England has the largest number, at 100 per 1,000.

In contrast, the UK’s LSE provides 407 beds per 1,000 students and Cornell in the US provides 310 per 1,000.

In particular, a lack of collegiate-style housing compared to countries such as the UK and US may be detrimental to the study abroad experience, the reports state, as collegiate accommodation provides “a more connected and more community-focused educational experience”.

“There is a perception in Australia that international students are only focussed on having their own private room,” Phil Honeywood, IEAA’s CEO, told The PIE News.

“However, both our commissioned research papers, and the dialogue at the symposium, indicated that other student destination countries, especially the United States, have a tradition of providing predominantly shared student bedrooms.”

Honeywood noted that some private accommodation developers in Australia are beginning to offer shared rooms and that there is “apparently growing demand for this option if there is a commensurate rent reduction”.

In the private sector, the high cost of housing puts Australia at a disadvantage to all other countries included in the study apart from the US.

“The real threat to Australia may come from cities that can offer both affordable collegiate living, as well as affordable and available private rental”

For some locations there was no housing available at a benchmarked affordable rents rate, which the report sets at around AUS$1,000 a month – around 30-40% of a “relative generous assumed income” of $30,000 a year.

Private market rent prices around inner city institutions can be equal to or more than those in some of the world’s most expensive cities, it adds, while those in suburban locations are more competitive.

“The real threat to Australia may come from cities that can offer both affordable collegiate living, as well as affordable and available private rental,” the research states.

Based on these findings, the reports conclude that further development of new, high quality accommodation in Australia is a “necessity”.

There are currently 58,109 beds of purpose built student accommodation in Australia’s six top metropolitan areas – up by 8% or 4,647 beds in the last year – and JLL predicts that developments will continue to increase in response to the lack of supply.

International student numbers have risen by 4.4% in the last year, with 8.9% yearly growth among tertiary students, who generate the most demand for purpose-built accommodation.

It also predicts that at least one more new significant developer or operator will enter the sector in 2015.

IEAA will create an Outcomes Report based on the reports and accompanying symposium, which it will use to lobby authorities at the federal, state and local levels to address the issue of accommodation.

“There will need now to be extensive follow up and an agreed action plan to get this key issue of student accommodation on the agenda of consultative bodies such as the newly formed International Education Ministerial Council,” Honeywood added.

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