BLOGS

The rental pressure building in university towns

For students preparing to secure accommodation ahead of the autumn term, the market picture remains challenging. REalyse analysis of rental listings across ten major UK university cities shows average asking rents now sit at approximately £1,260 per month, with significant variation by location.

Bristol commands the highest average asking rents at around £1,840 monthly, followed by Edinburgh at £1,530 and Manchester at £1,410. At the more affordable end, Sheffield averages £936 and Liverpool £1,060. But affordability is relative—these figures represent the general private rental market, and purpose-built student accommodation (PBSA) often commands premium pricing for the amenities and location advantages it offers.

The year-on-year trend tells a consistent story of upward pressure. Newcastle has seen the sharpest rental growth at over 6%, followed by Nottingham at nearly 5% and Liverpool at 4.5%. Even cities with more modest headline increases—Bristol at under 1% and Edinburgh showing a marginal decline—are starting from significantly higher base rents.

Where is the new supply?

The development pipeline offers both promise and frustration. REalyse planning data shows over 600 student accommodation schemes submitted across 23 university cities in the past three years, proposing a combined total exceeding 156,000 beds.

London dominates the pipeline with nearly 87,000 proposed units across 107 schemes. However, the capital also illustrates the delivery gap: over 69,000 of those units remain pending decisions, with only around 15,000 granted permission. Manchester shows a healthier conversion rate, with more than 10,200 beds granted from roughly 11,200 proposed.

Regional cities present a mixed picture:

• Bristol has 53 schemes proposing over 10,000 beds, with approximately 7,100 granted

• Glasgow shows strong activity with 51 schemes and nearly 5,900 granted beds

• Birmingham has 30 schemes with around 4,400 beds approved

• Leeds has secured permission for roughly 4,500 beds across 24 schemes

• Nottingham has 35 schemes but has faced higher refusal rates, with over 1,300 proposed beds refused

The data suggests that while developers remain keen on the sector, planning bottlenecks and local authority pushback in certain cities are slowing delivery.

Edinburgh and Glasgow: a tale of two Scottish cities

Scotland's rental market presents an interesting case study. Edinburgh shows a slight year-on-year decline in average asking rents—the only city among the ten analysed to record negative growth—yet listing volumes have dropped by approximately 24% compared to the previous year. This apparent contradiction likely reflects the impact of Scotland's rent controls, which have constrained asking rent growth while simultaneously discouraging landlords from remaining in the market.

Glasgow, by contrast, has maintained modest rent growth alongside a strong PBSA pipeline. The city has granted permission for nearly 5,900 student beds, with another 2,700 pending. Universities Scotland has repeatedly highlighted the accommodation shortage as a barrier to international student recruitment, and Glasgow's more permissive planning stance may prove advantageous in attracting development.

What this means for the 2026-27 academic year

The fundamental supply-demand imbalance shows little sign of easing. UK university applications continue to recover from pandemic-era disruption, and the international student market—while facing headwinds from visa policy changes—remains a significant driver of demand in key cities.

For investors and developers, the market signals remain positive: rental growth continues across most cities, occupancy in existing PBSA stock typically exceeds 95%, and yield premiums over conventional residential persist. REalyse data on rental performance and planning pipeline can help identify where supply gaps are most acute and where new development may face fewer barriers.

For students and their families, the practical reality is early preparation. Competition for accommodation intensifies each year, and those relying on the private rental market face both limited availability and rising costs.

Outlook

The student accommodation sector continues to attract institutional capital, with several major transactions completing in the past 12 months. Yet the gap between investment appetite and delivery capability persists. Planning delays, construction cost inflation, and local opposition to high-density student schemes all contribute to the supply lag.

Cities that streamline approvals and work constructively with developers—as Manchester and Glasgow appear to be doing—may find themselves better positioned to accommodate growing student populations without the rental inflation seen elsewhere. For now, the squeeze continues.