Brisbane's student accommodation market has experienced an influx of investment as developers take advantage of the incentives & subsidies that were on offer by the Brisbane City Council until 30th June 2017. Students looking for accommodation while studying in Brisbane will not be short of options with approximately 1500 purpose built student rooms completed in 2017 and an estimated further 4000+ still expected to hit the market in 2018/19. Students are spoilt for choice with a number of brand new locations to choose from, all with modern furnishings, large internet data plans and additional service offerings such as room cleaning & catered food. The question is- what impact is the increase in supply going to have on Brisbane’s Student Accommodation Market?
Hive’s recent market analysis confirms that as the variety of accommodation options available to students has increased, so too has the students expectations regarding both quality of accommodation product & the level of customer service expected from managers/providers. This has driven many providers to increasingly offer a range of incentives & flexibility around lease terms to maintain their occupancy & market share. Further market trends will be covered in more detail within Hive’s Student Accommodation 2018 Forecast which is due to be released later this year.
While it has never been more important to understand the demands & expectations of the student accommodation market, potential investors in this space should not be deterred. Hive consistently experiences solid demand for suitably priced, quality product in local university catchments. During the recent intake period (June/July) Hive experienced strong demand for ensuited and air conditioned rooms, despite the addition of 1500 student rooms to the market this year. Hive was able to achieve strong rental rates with leases running over summer & ending in the desirable Jan/Feb period.
Standard rooms (without air conditioning or an ensuite) & rooms in older properties without the bells & whistles are typically taking longer to lease, with those in secondary locations among the worst affected. However, there is no shortage of budget conscious students seeking well-maintained, reasonably priced, standard rooms which will ensure demand for this product remains consistent at the right price. Existing properties that have not been adequately maintained and display the wear & tear that comes with servicing the student rental market, will likely require a cosmetic facelift (ie. new paint, blinds, replace dated furniture) to remain competitive & hold rental rates.
As the market becomes more competitive, it is increasingly important that a specialised accommodation provider manages your investment. Hive Student Accommodation understands current market drivers and leverages this knowledge to minimise vacancy for our clients whilst also maximising rooming rental rates. Hive is interested in hearing from investors and developers of student accommodation.
For more information about the management services offered by Hive please contact us at today on 1300 882 326.