The Cost of Renting Student Accommodation
A recent article in TheJournal.ie highlighted the continuing growth of the student accommodation sector in Dublin.
Future Analytics Consulting (FAC) has identified a net total of 7,438 student bedspaces in the planning and development pipeline in Dublin City.
Of these, nearly 4,300 bedspaces are under construction, over 1,500 have been granted planning permission, but are yet to commence and a further 1,600 are under review by Dublin City Council or An Bord Pleanála. FAC has helped to secure planning permission for approximately 2,000 of these bedspaces.
The cost of student accommodation is one of the core elements of the article, highlighting that the rents in some residences start at €249 per week. Yet these ‘rents’ are all-inclusive, accounting for: rent, electricity, internet, TV licences, waste disposal, insurance, security and maintenance. Furthermore, with most new schemes in the city centre, the cost and time spent commuting are reduced. In the example, above, the total cost for a 37-week academic year would come to €9,213.
However, FAC analysis using Daft.ie rental data and figures released by service providers (electricity, gas, waste disposal, television, broadband and television licence) demonstrates that the costs associated with living in a property in the non-student, private rental market are not too dissimilar from student accommodation. Although of benefit is that a lease in this instance will probably last a full, 52-week calendar year.
While many question the pricing of student accommodation, if students cannot afford to pay the rents being asked, operators will be forced to reduce them and become more competitive. It will generally not be possible for an operator to change its target market to non-students, as Dublin City Council includes a strict condition in permitted schemes that prohibits their occupation by non-students (except during summer months as holiday accommodation in some properties).
Importantly, the article indicated that the development of any type of accommodation is positive. Student accommodation, albeit solely targeted at students, acts to serve the entire residential market by freeing up houses and apartments for occupation by non-students. FAC’s population modelling, conducted on behalf of the Housing Agency, has illustrated that there is an absolute minimum requirement to provide 79,000 new housing units by 2020. Demand will continue to rise and the supply student accommodation can act as a means through which to address this.
For more information on the student accommodation sector or to find out about our range of services – from securing planning permission to socio-economic studies – give us a call at 01 639 4836 or drop us an e-mail at email@example.com.