“What we have seen at Student.com is that the hunger for students around the world to study has not stopped, and COVID-19 has simply changed their plans somewhat, whether that is the end destination, their university city, or their start date, and even what type of student accommodation they book,” says Dan Baker, General Manager, EMEA at Student.com.

With international travel currently limited, the number of domestically mobile students is expected to grow and so is the overall number of students worldwide. While booking volume by international students has decreased across the board, the extent of decline has varied massively across destination countries. Booking data from Student.com suggests that Ireland (-11.74%), the UK (-29%) and Spain (-20%) have fared best, with Germany (-75%), the USA (- 75%) and France (-73%) seeing the greatest drop in demand year-on-year.

“As expected, there has been a decline in the preference for shared rooms, which could be down to students wanting to self-isolate. There is also a growing trend of groups wanting to switch to single rooms, rather than their usual shared rooms,” adds Baker. International students’ purchasing behaviour points to a 71% decrease in lower-cost bookings (below $4,000 in value), which are mostly short-term which is in line with the decrease in summer study due to COVID-19 travel restrictions. A higher proportion of students are choosing to pay extra money for a private room.

Naturally, international students are tending to prolong their decision-making process. The market has seen an 11% increase y-o-y in students taking 6 months or more to book a room. “This could be because lots of international students wanted to study abroad but took longer to confirm their bookings due to extra research because of concerns around COVID-19,” says Baker.

Sharing further details on how Student.com has adjusted, Baker stated that they had “worked closely with student accommodation providers to create a COVID-19-friendly booking environment, which included free cancellation on some properties and flexible move-in dates.’ He added that looking to the future, they “expect the demand by students to remain strong, but flexibility of higher education institutions and student accommodation providers will continue to be essential.”

Bonard’s B2B perspectives, which complement this joint market assessment initiative, were based on demand/supply dynamics in more than 120 cities globally, spanning 5,600 purpose-built student accommodation establishments.

No divestments have been witnessed in the market, says Bonard’s CEO Samuel Vetrak. “The sector has not lost its head after initial uncertainty. We closely monitor the global student housing pipeline. In Europe alone, we are tracking some 185 projects that are due to be completed in 2021, with an additional 95 projects set to open in 2022. What we see is that approximately 80% of these are likely to be delivered on time.”

Samuel Vetrak

CEO
Bonard

Samuel Vetrak, Founder and CEO of BONARD, has over 20 years’ experience advising government-led agencies, destination marketing bodies, education providers and their associations, as well as real estate investors, developers and operators in student housing and alternative residential. Since 2007, under his leadership, his staff of 50 researchers and analysts operating in four offices around the world have been providing the highest level of secondary as well as primary (in-field) research via mobile units, making BONARD an independent data powerhouse for student housing. Samuel has studied at City University Seattle. He is a frequent speaker attending dozens of real estate and property investment conferences a year where he is sharing the latest insights and trends in student housing and alternative residential.

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“In parallel, we have already received an increased number of enquiries about opportunistic assignments, mostly aimed at finding distressed properties, although not many student accommodation establishments fit the bill. It’s usually former hotels that are available for this type of repurposing at the moment,” adds Vetrak.

What injects another layer of confidence into long-term prospects for the sector is a general understanding that even though the asset class is not fully pandemic-resilient, it is recession-resilient – meaning that times of economic downturn fuel study abroad mobility and result in a growing number of students pursuing their courses abroad.

“This is what happened in the early 90s, after 9/11 and during the GFC of 2008-2009 and we have every reason to believe that the market will bounce back stronger once the pandemic is over,” ends Vetrak.