Britain’s largest student accommodation provider is facing challenges in filling its university residences as more young individuals opt to stay at home to save money. The Unite Group has experienced a decrease in international students and domestic students reluctant to accumulate significant debts.
The company reported that 86% of its student accommodations have been booked for the upcoming academic year starting in September, although this figure reflects a decrease compared to previous years. Despite a slight increase from the previous year’s reservation rate of 85%, it remains below the 94% reservation rate seen in the 2024/25 academic year.
Since the aftermath of the Covid pandemic, Unite’s occupancy rates have dropped significantly, with its share price plummeting by more than half since 2022. The company plans to sell off less popular university accommodations to focus on leading educational institutions, aiming to sell properties valued between £300 million and £400 million this year.
Joe Lister, Unite Group’s CEO, noted a positive trend in reservations for the 2026/27 academic year, attributing it to effective marketing strategies and pricing adjustments. He highlighted the financial challenges faced by students due to inadequate loan adjustments for inflation.
Unite Group manages a total of 72,000 beds across 208 properties in 29 cities, including its Unite Students and Hello Students brands. Despite current obstacles, the company anticipates its properties to reach 94% to 96% occupancy for the upcoming academic year, with a projected rental income growth of 1% to 2%.
The company has revised the estimated value of its properties, with a 2.2% decrease in the Unite UK Student Accommodation Fund’s value. Analysts, like Max Harper from Third Bridge, predict ongoing challenges in the student accommodation market, driven by increasing rates of students living at home and declining demand for lower-tier universities.