Record student demand continues to support the UK student accommodation sector, but growth is becoming increasingly concentrated in a select group of university markets.

That’s the view of Cushman & Wakefield’s 2026 UK Student Accommodation Report. 

Total student acceptances through UCAS reached 518,300 in 2026, up 1.1% year-on-year, while a record 294,350 UK 18-year-olds entered higher education, driven by continued demographic growth.

Markets with strong institutions, prime locations and diverse student populations continue to outperform, attracting growing numbers of domestic and international students, while locations such as Aberdeen, Dundee and Nottingham are facing softer demand and increasing competition.

The report highlights a growing divide across the UK student accommodation sector, where local market fundamentals are playing an increasingly important role in determining performance.

The growing divergence between university markets is particularly evident in international student demand. 

Sponsored study visas totalled 231,600 between January and August 2026, down 22% compared with the same period in 2025, reflecting the impact of recent immigration policy changes and other market factors.

However, international demand continues to outperform in several key locations. London added almost 60,000 international students between 2019/20 and 2024/25, while Birmingham and Bristol recorded further growth during the most recent academic year despite wider market pressures. 

Leeds, Sheffield, Leicester, Swansea and Edinburgh all recorded notable declines in international student numbers, underlining how international demand is becoming increasingly concentrated among a smaller number of universities.

After significant post-pandemic rental inflation, private sector rental growth for students has moderated substantially.

National private sector rental growth slowed to just 0.52% for the 2026/27 academic year, while studio rents were broadly flat. In several cities, rents declined as operators focused on maintaining occupancy and responding to changing demand conditions.

Brighton (-6.7%), Glasgow (-6.1%), Swansea (-5.5%), Nottingham (-4.1%) and Sheffield (-3.7%) all recorded falls in rents, while stronger-performing locations such as Guildford, Belfast, Durham, London and Bristol continued to achieve positive rental growth.

The moderation follows rents increasing by almost 20% between 2022/23 and 2024/25 and suggests a necessary rebalancing in parts of the sector.

One of the report’s most significant findings is that affordability has begun to improve for many students. 

Slower rental growth, combined with increases in maintenance support, has eased pressure on many students. In England’s regional markets, average accommodation costs now account for around 81% of total maintenance support, while Wales remains the most affordable nation for purpose-built student accommodation (PBSA).

Improving affordability dynamics could help support demand for purpose-built student accommodation at a time when traditional shared housing faces increasing pressures from regulation and rising operating costs.

While affordability is improving in many private PBSA markets, the research highlights a notable shift in the relationship between university-owned and private sector accommodation.

Universities have traditionally been viewed as the more affordable option, particularly for cluster accommodation. However, the data shows that in nine UK student accommodation markets, the average cost of a university-managed bed now exceeds that of an equivalent private sector room. 

In addition, there are 31 markets where students can secure a private sector en-suite room for less than the university equivalent.

This means that, in some locations, students choosing the private sector can access newer, purpose-built accommodation while paying the same, or even less, than they would for university-owned housing.

The findings challenge the traditional assumption that university accommodation is the most affordable choice and could influence future accommodation strategies across the higher education sector.

Russell Hefferan, Head of Student Accommodation Capital Markets at Cushman & Wakefield, says: “With the era of ultra-low interest rates behind us, future returns will be driven by income growth rather than yield compression. As a result, investors are focusing on assets with resilient occupancy, sustainable rental growth and proven operational performance. In the next phase of the market cycle, competitive advantage will come not from simply owning PBSA, but from owning the right PBSA assets.”