EU Students Accepted To UK Universities Second Highest on Record, Whilst Non-EU Overseas Students Coming to Study in UK Has Never Been Higher
As we have reported on many occasions on this blog the student property investment sector has been the top performing investment for many years, buoyed by ever-increasing student numbers and a serious under-supply of suitable housing in cities with major student populations.
Both private and institutional, have been extremely active in the sector, which has seen steep increases in the amount of investment over the last 3 – 4 years.
As we know the terms of Brexit are the focus of fierce debate and a large degree of uncertainty, whilst tuition fees and interest charged on them have seen small but significant increases putting further barriers in the way of university-bound students.
Tuition fees in England have risen to £9,250 this year, at the same time the interest charged on student loans has also risen from 4.6pc to 6.1pc.
However, the good news is that the latest figures show that the UK remains a highly attractive option for foreign students both from within the EU and with non-EU overseas students.
UK, EU and Overseas Students Numbers
The biggest effect on student numbers appears to be on UK students with applications down by about 3% and with around 2,500 fewer acceptances. These numbers must be more influenced by tuition fees than Brexit, with an increasing number of teenagers opting for apprenticeships rather than university courses to avoid the high levels of debt.
Whilst EU student applications are down 4.4%, or 2375, on 2016 numbers, this is only because 2016 was a record-breaking year for EU applications and the current figures are in fact the second highest on record with 51,185 European students applying for UK university places in the 2017 cycle!
A spokesman for UCAS said:
“The number of applicants from the EU in 2017 is the second highest on record.”
Furthermore, both universities and the government are keen to keep the number of EU students coming to the UK as high as possible. In an attempt to mitigate any Brexit concerns ministers have pledged that EU students starting courses in the 2018/19 academic year will still be eligible for government tuition fee loans.
Universities Minister Jo Johnson said;
“A key part of the success of British universities is attracting talent from across the globe. EU students make an important contribution to our universities and we want that to continue.”
One demographic for whom tuition fees do not appear to be an issue is for non-EU overseas students, who in fact pay significantly higher fees. The number of non-EU students applying to UK universities has increased by 2.8 per cent to 76,380, the highest on record! This is also matched by an increase in acceptances which rose by 5 per cent.
The rise in non-EU overseas students has off-set any fall in EU and UK students applying to UK universities and Christopher Bickerton, a Cambridge lecturer in European politics is quoted as saying;
“I’m not surprised… People tend to forget that we have world class higher education system.”
So, what does this mean for the buy student accommodation investment sector?
Firstly, we can see that although EU student numbers have fallen for the first time since 2012, they are still the second highest numbers ever recorded, which certainly does not indicate a catastrophic reaction to Brexit.
Secondly, non-EU overseas student numbers are increasing, making up for any reduction of EU students coming to the UK, therefore the overall numbers of students are still increasing – and crucially, that increase is in the right demographic! UK students are less likely to pay higher rents for luxury accommodation compared to their foreign counter-parts and so the ‘micro-market’ for purpose-built student accommodation is actually growing as a higher proportion (non-EU overseas students) of the total student population are predisposed to look for better, more expensive accommodation.
Therefore we predict that buy student accommodation investment will continue to be a sought-after and profitable investment class for the foreseeable future as there is no fundamental change to the under-supply of student housing and in fact, it would appear that the section of the student population most attracted to the purpose built student accommodation units are in fact increasing in numbers.