The following blog is an extract from our recent, free-to-download Affordability Report.
This section explores the student journeys of James, Hazel and Jade. The trio's decisions highlight the multifaceted considerations in the student housing market. Understanding these choices and the role of high-quality data in meeting student needs is crucial for PBSA providers aiming to cater to a diverse student population.
Our students' preferences
For our three student journeys, all looking for accommodation for the 24/25 academic year, they all start off with 95 buildings to choose from.
James is doing English Literature, so only has limited requirements to be on campus. He’d rather a good variety of cafes to read in and to be able to get his social network established in the city centre – illustrated by the turquoise pins on the map.
Hazel doesn't want the cost of the city centre and needs to balance being able to get to campus with a tight budget. She's looking for somewhere with short bus routes or easy cycling distances – the salmon pins.
Jade is doing Chemistry. She needs to spend most days on campus in the labs, so she needs the efficiency of being on or close to campus – the purple pins.
Three students, three very different decisions
James was looking for a city centre location. He liked the idea of a library on site and has noticed some newer developments in Leeds – this feels like an additional bonus so it helps him narrow down his choice to White Rose View and the soon-to-open Tribeka.
Hazel wants to be nearest to Leeds Beckett (Headingley Campus) and has the lowest search budget. She’s also prioritising gym facilities. This narrows her down to three choices, and, after adding the lens of previous student experience, narrows down again to Oxley residence, which scores the highest review rating of the three.
What can Jade afford?
For Jade, narrowing down by student experience makes her choice that bit easier: scoring a very strong 4 stars overall, Jade thinks she can stretch to £175 per week to live at The Priory. She may need a part-time job, but she can make it work. However, it will be important for the site team to deliver well. Jade is stretching her budget so she will want to feel like that was worth doing. This is where the excellence of a staff team can make the critical difference.
PBSA decision-making
Students generally need to make one major decision about their accommodation for each year of study. The decisions that are required on the industry side are many. Both sides benefit from having data readily accessible. We advocate that prospective residents read peer reviews of accommodation which will tell them important information that may not be found on a provider’s website. Likewise, PBSA decisions need to be data-led and strategic.
We have been illustrating these student journeys with our sector-facing tool. It allows PBSA investors, providers and operators to make decisions about rent-setting, amenities, where to build, what to build and so on, through the provision of important contextual information such as the pricing dynamics in a specific market for the last three cycles. It helps to answer questions like these: How does Building A compare to its competitors? Does a nomination agreement make sense with the local university? What is the gap in provision in this market? What insight opens up when we categorise this market broadly across different provisions?
Consider the use of incentives. Does Market B need encouragement to sell out, or do most buildings fill early? What about the pipeline of student accommodation? Will the buildings coming online in Market C in the next 24 months fundamentally change the accommodation provision?
Catering to students’ needs
Understanding a market’s history, current provision and future expansion sets up providers to win over the opinions of future residents seeking a best-fit accommodation provision for their budget. As we have highlighted, affordability is subjective and students come with a unique set of budget constraints, ideals and preferences. A successful market will be able to cater to different needs through flexibility and agility, driven by high-quality data in order to respond to local market fluctuations. Understanding the student mindset is also fundamental, and can be discovered in qualitative content like reviews.
Key Takeaways
Dissatisfaction is where expectations haven’t been met. It could be generated when a student has stretched their budget but has not been wowed by their experience, or it could be the byproduct of a student realising in hindsight that they could have chosen differently but they didn’t know they had that option at the time. Both of these scenarios stem from not enough information being in the hands of the decision-maker at the right time.
Excelling in this space isn’t about a race to premium pricing, or indeed shoehorning in low-priced rooms. It is better to consider how the PBSA industry informs the student body of the variety of options available, and how those options are shaped to fit the specific nuances of the locale they are in.
Affordability is about best matches between the drivers of choice for a student, their budget and the variety of options the sector offers to meet their needs.
“The UK student housing market is poised for diversification in the coming years, reflecting a wide spectrum of preferences in building design, amenities, and overall student living experiences. The current landscape features a vast array of accommodation types, ranging from older stock with shared bathrooms and minimal social spaces to modern developments offering en-suite rooms, studios, and extensive amenity space....” - Martin Handland, Founder, SFG
As Martin notes here, the sector needs diversification. It needs no-frills buildings, alongside all-the-frills buildings. But more importantly, it needs to engender a thriving student population, so that in response to ‘what would you do differently?’ the answer is never ‘I wouldn’t have applied’.
To read the full StudentCrowd affordability report, visit our page today.
