Fall 2016 will bring in the third-highest ever new national supply of beds for privately owned, purpose-built student properties, with 47,700 expected across the country, according to the new Axiometrics update on the student housing market's performance.
Seven of the top ten student markets for new 2016 growth are in the Southeast or Southwest. Arkansas takes the top spot, with 2,319 new beds expected by this fall. Expect more campus to see this influx of supply in 2017; 2,336 beds are expected at Texas A&M by Fall 2017, and Michigan State isn’t far behind with 2,324 expected beds.
“Privately-owned student housing is quickly becoming an integral sector in real estate, and performance metrics demonstrate its strength,” says Jay Denton, Axiometrics’s senior vice president of analytics. “Axiometrics forecasts rent growth to remain strong over the next five years and occupancy to stay above 95%, as enrollment continues to rise nationwide.”
Average effective student housing rent is up to $618 this fall, $14 above the 2015 rate. Rent growth is up to 2.3%, 0.3 pct. points above 2015, and pre-lease rates are up to 83.4%, 0.15% points above 2015. Rent was highest for the properties closest to campuses, while effective rent growth was highest for properties between a half-mile and one mile away.