With purpose-built student accommodation (PBSA) rents rising by 18% annually and student housing budgets rising by 15%, the UK student housing industry is experiencing a serious affordability crisis. According to the most recent research by a source, the average yearly rent for PBSA for the academic year 2024–2025 is £13,595, making housing more and more difficult for students to afford.
Students are facing more financial draining as the gap between maintenance loans and real living expenses grows. Many students are finding it difficult to make ends meet because the average yearly cost of PBSA in places like London exceeds the maximum maintenance loan amount of £13,348 set by the UK government. The survey states that 61% of students have taken out loans to pay for accommodation, and 59% of students find it difficult to make ends meet.
Causes of the Crisis
Several factors contribute to the rising costs of student housing. These include:
-Increase in Rental Costs: In early 2025, rental prices rose by 8% nationwide, with increases accelerating in areas like London, Manchester, and Edinburgh.
-More International Students Enrolled: The housing market was strained by the more than 600,000 international students that enrolled in the 2023-24 school year.
-Lack of Supply: Although the demand for housing is rising, there is a steady supply, which drives up prices and spending plans.
-The trend toward premium PSBA: Because of its privacy and independence, PSBA has grown in popularity as a housing alternative, although it is more expensive.
The affordability crisis has extensive effects. A lot of students are using credit cards, bank loans, and borrowing from friends or family as alternate sources of financial assistance. In order to fulfill their increased financial needs, some have extended their part-time employment hours, which may have a harmful effect on their academic performance and general well-being.
An obvious sign of a rising affordability situation is the 15% increase in the percentage of student budgets allocated to housing. The growing expense of housing will continue to jeopardize academic performance, student well-being, and the core belief of fair access to higher education in the UK unless prompt and efficient measures are taken.
Potential Solutions
Increasing the availability of affordable homes is one possible way to address the affordability challenge. The strain on the housing market might be lessened by creating more cheap housing options, including subsidized housing or cooperative living.
Examining lending policies for maintenance: Students may be able to pay for their accommodation by reviewing maintenance loan conditions to make sure they stay up with the growing cost of living.
Offering financial assistance: Giving students financial aid in the form of grants or backings may allow them to pay for their living expenses and lessen their dependency on credit cards and loans.
