By The purpose built student accommodation (PBSA) sector has bounced back from a pandemic induced decline, with an estimated market size of almost £4bn which Stripe estimates will climb to £4.5bn by 2025.
The latest figures on the size of the PBSA sector, a sector that supplies vital stock to meet the overwhelming demand from the nation’s student population, have been analysed.
The latest figures show that the current market size of the sector is an estimated £3.971bn, having increased by 67% in the last decade from £2.4bn in 2013.
What’s more, the sector has bounced back from a pandemic decline in the size of the market seen in 2021.
The PBSA sector had peaked to its highest point in 2020, with an estimated value of £4.1bn.
However, as the impact of the pandemic took hold, the market size of the PBSA sector plummeted by -21% in a single year to £3.2bn in 2021.
This saw the market size of the PBSA sector reduce to its smallest level since 2016, driven by Covid restrictions that prevented students from pursuing higher education in a physical format.
However, the sector has bounced back in 2022, with the estimated market size increasing by 23%, although it remains 4% below its pre-pandemic peak.
But the latest forecast from Stripe Property Group suggests that this pandemic impact could be well and truly put to bed this year, with the PBSA sector predicted to hit £4.2bn in market size in 2023, an annual increase of 6% and 2% above its pre-pandemic peak.
It is also estimated that PBSA momentum will keep on building, climbing by a further 8.1% by 2025, with total market size hitting over £4.5bn.
James Forrester, Managing Director of Stripe Property Group, the property developer and PBSA specialist responsible for the research, commented:
“While pandemic restrictions were problematic for many areas of the UK property market, the PBSA sector was hit particularly hard by the almost immediate reduction in demand for student housing, as higher education was no longer pursued in a physical format.
This brought about a notable reduction to the market size of the sector and we’re still feeling the impact of this downturn today.
However, we are heading in the right direction and we predict that the impact of the pandemic will be nothing more than a memory by the end of this year.
The returning health of the PBSA sector has been driven by a return to normality for many students and purpose built student accommodation is once again in very high demand.
We’ve seen the stories around the shortage of suitable accommodation to meet demand and so the vital role played by the PBSA sector is only going to grow in importance as the years go on.”
| Student accommodation in the United Kingdom – est market size and change over time | |||
| Year | Est market size (£) | Change £ | Change % |
| 2013 | £2,383,400,000 | – | – |
| 2014 | £2,667,800,000 | £284,400,000 | 11.9% |
| 2015 | £2,778,600,000 | £110,800,000 | 4.2% | 2016 | £3,045,200,000 | £266,600,000 | 9.6% |
| 2017 | £3,470,500,000 | £425,300,000 | 14.0% |
| 2018 | £3,632,800,000 | £162,300,000 | 4.7% |
| 2019 | £3,907,400,000 | £274,600,000 | 7.6% |
| 2020 | £4,120,300,000 | £212,900,000 | 5.4% |
| 2021 | £3,237,200,000 | -£883,100,000 | -21.4% |
| 2022 | £3,971,000,000 | £733,800,000 | 22.7% |
| 2023 est | £4,195,619,292 | £224,619,292 | 5.7% |
| 2024 est | £4,364,674,394 | £169,055,102 | 4.0% |
| 2025 est | £4,533,729,496 | £169,055,102 | 3.9% |
Data on current UK PBSA market size sourced from IBIS World
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