Invezz.com - The promise of high-quality education and diverse opportunities has fueled a steady rise in international student numbers to popular destinations such as the United States, United Kingdom, and Australia in recent years.
These countries have long been favoured by students seeking not only world-class education but also access to global career prospects. However, recent data shows just how significant this surge has been.
The UK government’s revelation that it has met its 2030 international student recruitment target of 600,000—ten years ahead of schedule—highlights the increasing draw of these markets.
Despite the global disruption caused by the COVID-19 pandemic, student numbers have continued to rise.
The US, too, has seen a remarkable recovery, hosting over a million international students in the academic year 2022-23, representing a 12% increase from the previous year.
This was the fastest growth rate in over four decades, signalling a strong rebound in global mobility for education.
Rising demand for student accommodation amid supply shortages
This influx of students has also led to an unprecedented demand for student housing, particularly purpose-built student accommodation (PBSA).
The UK has witnessed a nearly 20% growth in demand for PBSA over the last decade, far outpacing the supply available.
The shortage is especially pronounced in major cities like London.
According to CBRE, London alone has around 400,000 students but only about 100,000 PBSA beds, leaving a significant gap in the market.
This shortage has created both opportunities and challenges for student housing providers. In response, companies like amber, a Pune-based housing booking platform for international students, have experienced rapid growth.
Operating in key education markets like the UK, US, and Australia, amber has positioned itself as a leading player in the PBSA industry.
The company currently boasts a gross booking value of $1.2 billion, underscoring its ability to tap into the growing need for student accommodation in global education hubs.
In an interview with Invezz, Saurabh Goel, CEO and co-founder of amber, discussed the evolving PBSA landscape and the broader implications of recent government policies aimed at limiting international student numbers. Edited excerpts:
Invezz: What was the thought behind entering the student housing market and what has your experience so far been like?
Our decision to enter the student housing market was born out of a clear observation of the difficulties our friends faced when looking for suitable accommodations while studying abroad.
This insight highlighted a significant gap in the digital market for student housing solutions, prompting us to launch ‘amber’ in 2016.
By 2017, we had expanded our operations to key study-abroad destinations such as the USA, Canada, the UK, and Australia.
The expansion of our team to over 600 employees by 2023 and our successful funding round in 2024, where we secured USD 21 million, marks a significant milestone in our journey. These funds are earmarked for further expansion into markets like the UK, Australia, and Ireland, as well as new territories such as the US, Canada, and Europe.
Our goal is to improve our offerings for both property managers and students, ensuring a seamless and supportive housing experience for international students worldwide.
Student housing market in the USA thriving
Invezz: Earlier this year, you raised your first round of institutional funding. What is on the cards next for Amberstudent in terms of expansion, entering new markets, and offerings?
Following our successful initial funding round earlier this year, amber is focusing on expansion into the USA and China.
We are particularly excited about the opportunities these markets present and are dedicated to better serving international students and property managers in these new territories.
Invezz: Which student housing market is currently thriving the most in terms of investment, growth, and occupancy rates, and why?
The student housing market in the USA is currently thriving the most in terms of investment, growth, and occupancy rates.
This success is largely attributed to strong market fundamentals and relatively stable governmental policies compared to other regions, making it an attractive hub for student housing investments.
Fall in Nigerian students in the UK due to weakening of currency
Invezz: Are you seeing any pertinent shifts in the nationalities bringing in demand for student housing in different markets? What are the other interesting trends you are seeing emerge in the market?
We are noticing shifts in demand with a decrease in Nigerian students in the UK market, primarily due to the weakening of their currency.
Other interesting trends include an increasing demand for more comprehensive services integrated into student housing, such as career guidance, mental health support, and financial services, which we are addressing through our amber+ suite.
Impact of curbs on international students?
Invezz: With new restrictions on international students in Australia and the UK, are you factoring potential negative impacts into your business plans?
While recent caps and restrictions on international students in countries like Australia and the UK could impact the overall demand, we believe these changes will not affect genuine applicants.
amber plans to continue adapting our strategies to ensure we meet the needs of genuine students, who form the core of our customer base.
Invezz: With Canada cutting new international student permits by 35%, how do increasing restrictions on foreign students impact the global student housing market?
The tightening of policies on international students and workers in countries like Canada is seen as a move to streamline the market.
This could potentially benefit genuine students in the long run, leading to a more organized and quality-focused student housing market globally.
Invezz take: Short-term hurdles or changing trends?
The international student housing market is undergoing rapid changes as a result of global shifts in education demand and increasingly restrictive immigration policies.
Countries like the UK, Australia, and Canada, once known for welcoming large numbers of international students, are tightening regulations, capping admissions, and cutting visa permits.
These moves are driven by a variety of factors, including domestic housing shortages, pressure on public services, and political agendas.
As a result, the global student housing market must adapt to these restrictions, which could lead to reduced demand in key markets, changing the landscape for property investors and developers.
Despite the potential short-term disruptions, these regulatory shifts might lead to a more structured and quality-focused market.
Genuine students, who are committed to their education abroad, may find improved housing services and support, as providers adjust to the evolving landscape.
Additionally, the restrictions could drive new opportunities in under-explored markets, while encouraging institutions to develop more localized solutions.
Overall, the student housing industry will need to remain agile to navigate these changes and continue serving the needs of international students globally.
This article first appeared on Invezz.com
