Britain’s largest student housing provider is facing challenges in filling its university accommodations as more young individuals opt to stay at home to save money. The Unite Group has experienced a decline in international students and domestic students who are wary of accumulating significant debts.
The company reported that 86% of its student housing beds have been reserved for the upcoming academic year starting in September, although this was achieved after reducing prices. Despite a slightly higher reservation rate compared to the previous year, the current rate is notably lower than the 94% recorded for the academic year 2024/25.
The demand for student housing has shifted considerably since the aftermath of the Covid-19 pandemic when Unite’s accommodations were consistently over 97% occupied. Consequently, the company’s share price has plummeted by more than half since 2022 and further dropped by 2% following the recent update.
To address these challenges, Unite Group is selling off properties in less popular universities to concentrate on prominent educational institutions. The company aims to sell properties valued between £300 million and £400 million this year.
Unite Group’s CEO, Joe Lister, expressed optimism regarding strong reservation progress for the 2026/27 academic year, attributing it to effective marketing strategies and targeted pricing adjustments in specific markets. Lister highlighted the increasing financial burden on students and families due to stagnant student loan rates compared to inflation.
With a portfolio encompassing 208 properties in 29 cities totaling 72,000 beds, Unite Group operates Unite Students catering primarily to first-year students and Hello Students targeting older students. Despite the current challenges, the company anticipates its properties to be 94% to 96% occupied in the upcoming academic year with a projected rental income growth of 1% to 2%.
Moreover, Unite Group has revised the estimated value of its properties, indicating a 2.2% decrease in the Unite UK Student Accommodation Fund to just under £3 billion. Analysts, including Max Harper from Third Bridge, foresee ongoing market challenges due to students opting to live at home and declining demand for lower-tier universities amid concerns about the value of a degree.
