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Brexit and student housing: A degree of uncertainty

Brexit and student housing: A degree of uncertainty

Overseas student applications to UK institutions were affected by the Brexit vote. In this thought leadership piece, KPMG looks at the big questions facing real estate investment in student accommodation.

Andy Pyle

Partner and Head of Real Estate

KPMG in the UK


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Applications from overseas to study in the UK have nosedived since the Brexit vote. Along with everyone else, investors in real-estate of student accommodation are being forced to re-evaluate the market. It’s a high-value industry: a rise in PBSA (purpose-built student accommodation) means private and university-owned accommodation is now worth £43 billion.

An exit from Europe would presumably mean a move from UK-level to ‘international’ tuition fees for EU students – an off-putting increase of 50%. Such fee increases could drastically decrease the UK’s desirability as a higher education destination – impacting the number of students searching for accommodation.

There are, however, positives. Some of the UK’s cities are liable to be more robust than others – Scottish universities have the advantage of a no-fee structure, Oxford and Cambridge have glowing worldwide reputations and London retains a global appeal. 

Some of the key findings in our report include: 

  • UCAS figures show the number of EU students applying early for January 2017 course deadlines were down 7.4%.
  • Leaving the EU might translate into EU students losing their current right of paying identical fees to UK students; reclassifying them as ‘international students’ would mean a 50% increase in fees.
  • The depreciation of sterling has made UK living more attractive than previously, with university purpose built student accommodation remaining the most popular choice of accommodation for non-UK students.

However, the sands are shifting. Developers must find new locations and react to the increase of non-EU students. Higher education has tended to be relatively recession-proof in the past – developers can help themselves with some insightful market analysis and agile movement. 

To find out more, read our full Brexit and Student Housing report. (11 minute read)

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