A strong increase in college and university enrollments from last year is helping to sustain historic student housing growth rates for the coming year, according to a new industry report.
The Student Housing National Report, as published by the Santa Barbara, California-based Yardi Matrix real estate solutions company, is showing current pre-leasing rates at nearly 68%, an exceptionally vibrant performance.
That figure, according to the report, is 2.4% higher than where things stood a year ago, and a significant 10% from figures compiled between 2019 and 2022. “Strong pre-leasing is an indication of solid demand from growing enrollment and suggests the market is easily absorbing any new beds for fall 2024.”
The industry has clearly rebounded from the brief dip recorded in the spring of 2020 during the Covid 19 outbreak. At that time, occupancy was down by some 3%, according to figures compiled by the National Apartment Association.
But the figures improved by the spring of 2021, with an overall 1% increase, even as roughly two thirds of the nation’s universities were offering online and/or hybrid teaching.
Looking at pre-leasing data for more than 1,500 properties at nearly 200 schools, the Yardi Matrix report notes that of that pool, “46 had pre-leasing over 75%, and eight were better than 90% pre-leased in March.” Only thirty markets were behind where they were a year ago at this time.
Student housing rents, meanwhile, reached an average of $895 per bed last month, 6% up from March of 2023. The growth rate picked up considerably most recently when students returned from spring break.
“Rent growth in student housing is being driven by surging demand, particularly at the schools with the strongest recent enrollment growth,” continues the report, which is predicting decided increase of 46,285 new beds for all of 2024. That number is sharply up from the 37,756 new beds seen in 2023.
In a report published two months ago, the New York Times noted that new student housing projects are bigger than ever. “Some are home to more than 1,500 students,” said the paper, “and they are being built on prime parcels as close to the campus as possible as developers seek to better manage their bottom line.”
By Garry Boulard
