Having outperformed other property markets, the student housing sector continues to excel. Demand for student housing remains high, and student housing developments are growing to keep up with the high demand.
Factors like sustainability are playing an ever-increasing role in student housing development. We see students commit to leases early to secure the best student properties, opening up opportunities nationwide.
These and other student housing trends provide keen insights into student housing. Want to know more? This is your student housing market report with investment insights for 2025.
Preleasing is the practice of applying for and even paying a deposit on a property before it is available to view. This often happens in the student housing market.
One of the highlights of our national student housing report for December 2024 was the stability of the market’s pre-leasing rates. Pre-leasing activity for the 2025-26 academic year reflects consistent student housing demand.
We noticed a high demand for student housing early in the leasing season. This is driven by students who, in competition with their peers for prime locations, are eager to secure the best student housing options.
With the recent focus on purpose-built student housing, students now look forward to modern facilities with more amenities and conveniences than ever before.
To the delight of investors, the student housing rental sector has surpassed other property sectors. Hence student housing remains a popular market segment for investors, with steady demand and growth.
According to a 2024 report on America’s rental housing by the Joint Center For Housing Studies of Harvard University, residential rental markets were cooling. This meant slower home sales at lower prices with less buyer competition.
Apartment demand had started to rebound, but apartment rent growth had not. This is in stark contrast with the growth seen in the student housing sector.
Not much has changed in the residential property market since that report. While typically considered a form of residential real estate, student accommodation is also framed as commercial real estate. And market experts indicate that the outlook for commercial real estate investment in 2025 is positive.
What investment insights can we glean from student housing market analysis and recent student housing market trends?
Demand is highly influenced by enrollment rates. We recommend you look at our list of the largest college and university enrollments to understand what this means for student housing demand. It will help you to make better student housing investment choices.
One of the most important factors in student housing is location. Proximity to academic institutions offers students the convenience they need. Student housing in American campus communities remains in high demand. There is also demand for off-campus purpose-built student housing near flagship universities.
In our December 2024 snapshot of the student housing market, we discussed how the national average rent per bed was seeing growth. The national average advertised rent per bed was $994, indicating year-over-year growth of 4.59% —good news for investors.
The Environment, Social, and Governance (ESG) investing principle has attracted a lot of interest, globally. It prioritizes environmental and social issues and more responsible corporate governance.
We recommend looking for developments that embrace ESG principles when researching properties to invest in. The modern student housing sector is increasingly focusing on ESG. Energy efficiency and sustainability are now getting the attention they deserve, and students are responding favorably.
When the Federal Reserve raises interest rates, the costs of mortgages increase. These higher costs to buy and develop properties can delay housing developments and dampen investor confidence. That said, higher interest rates can also lead to lower property prices.
With less demand amid high rates, owners are forced to drop asking prices to sell properties. This is good news for anyone wanting to buy and develop properties for student housing.
Interest rate fluctuations have a direct effect on property valuations and real estate investor’s returns. They will always be a crucial factor in student housing property investment. Our guide to how interest rates affect investments explains this in detail.
The student housing sector has much to offer investors. It is seeing surges in pre-leasing, consistent demand, and impressive market performance.
Are you ready to invest in the student housing property market but struggling to gain an insight advantage?
College House offers insightful student housing market reports, up-to-date data, data analysis, and intelligence for student housing investors, developers, and property managers. Book your demo today, and get the student housing market facts you need.
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