Private HMO landlords leaving the sector have created a shortage of student housing, according to Unite Students, which boasts that it can help fill the gap with purpose-built student accommodation.

The UK’s largest student home provider announced 8% rental growth last year and chief executive Joe Lister says this year’s outlook is encouraging, driven by increasing demand and a more supportive policy environment for international students.

“Many university cities are facing housing shortages, and our investment activity is focused on those markets with the most acute need,” adds Lister. “We are well-positioned to respond, with a robust development pipeline and new university joint-venture partnerships.

Choosing to leave

“Over half of students who need term-time accommodation live in HMOs where many private landlords are choosing to leave the sector due to rising mortgage costs and increasing regulation. In some markets, delivery of build-to-rent accommodation is partially mitigating reduced availability of HMO stock, albeit at higher price points.”

Although new PBSA supply is still 60% below pre-pandemic levels, Unite Students reports a committed pipeline of £1.2 billion of traditional development close to campuses.

UK students account for 72% of the company’s customers in 2024/25 compared to 60% immediately before the pandemic, and it says this reflects its success in retaining second- and third-year students who might have historically moved into the HMO sector.

Applications for the 2025/26 academic year are up 2% on 2024/25 from UK 18-year-olds, while international student demand is improving for 2025 after the disruption created by changes to visa policy in early 2024, with a 3% increase in international applicants for the next academic year.

“The government has also set ambitious targets for new housing, and we will play our part in delivering new student accommodation which frees up local housing for families,” adds Lister.