Yardi Matrix Says Student Housing Still Strong, but Some Metrics Slow

(Image courtesy of Yardi Matrix; Breakout image courtesy of RDNE Stock project/pexels.com)

Yardi Matrix, Santa Barbara, Calif., reported in its National Student Housing Report for May 2024 that student housing metrics have moderated somewhat, but remain solid overall.

Preleasing was at 73.5% in April 2024, 50 basis points above April 2023. While that’s a small level of growth, it remains above the pre-pandemic average for the sector.

Some operators did note recent challenges and delays with the new FAFSA may have sparked a slowdown.

Average rent per bed was at $895 in April, a 5.5% increase year-over-year.

While that’s slower growth than the beginning of the leasing season, it’s well above the historical average growth rate of 3.5%.

However, rent growth does range depending on location. For example, large primary state schools and secondary and tertiary sate schools in Sun Belt states with growing enrollments have seen significant rent gains.

The supply forecast anticipated 46,285 new beds in 2024 at Yardi 200 schools (the top 200 investment-grade universities across all major collegiate conferences.)

That’s up from 37,576 in 2023 and near the peak years of 2013-2014. However, Yardi Matrix anticipated supply will drop below the long-term average of 36,322 beds per year over the next five years.

Student housing investment has been fairly flat from last year, with the same number of properties sold so far (18) as in 2023. The average pricing of $100,857 per bed for sales is notably above previous years.