Students have long been thought of as being a cash strapped low income group. Our research suggests that those days are gone (for those who didn’t know already), in fact over the last decade a silent student revolution has been happening. By 2011 students and the higher education sector were already contributing 2.8% of GDP (Universities UK). There are now being well over 2 million students in the UK and this is a group that deserves more attention.
In various city centres buildings are popping up that illustrate the immense size of the student market. Student accommodation has become big business, with London in particular being heavily focused on, making up 36 per cent of the entire investment in UK student accommodation sector (Cuff, 2015).
Students demand quality, modern accommodation, far away from the cramped, standardised rooms that have previously been synonymous with student living. Students are now willing to part with large sums of money each week with rents for rooms starting near £200 in London (Cuff, 2015). The student accommodation market is booming and expected to continue to grow due to an increase in the number of enrolments combined with a shortage of student accommodation.
Investment is being poured into the student property market with over £4.2 Billion being invested in the first 5 months of 2015 alone (Property Wire, 2015). Due to the enormous sums of money involved it is more important than ever that property developers and managers listen to the voices of students. Considering the huge amount of investment in the sector and the fact that properties are kitted out with gyms, cinemas, it must be asked “what do students really want from their accommodation provider?”. According to the National Union of Students (2014) the most important factors when students are choosing accommodation are the location (56%), affordability (37%) and ease (32%).
Other sectors are also realising the opportunities that exist in the student market, with it being reported that students spend on average of £925 a year on takeaways (HungryHouse), as well as there being over £2.6 Billion in opportunities for the retail and leisure industry (Briggs, 2014). There has been a large drop in students use of alcohol, with student unions reporting a 50% reduction in revenues from alcohol over ten years from 1997 (Shepherd, 2007). A survey by Topman showed that 33% of students spent over a third of their loan on clothing (Briggs, 2015). Applying a stereotype to students will miss these key changes in consumption, with research being the only way to gain a real insight into the potential of these consumers.
Having just graduated myself it was a shock how quickly student accounts would become empty and then overdrawn. My peers thought nothing of going out on spending sprees, with my flatmate buying a MacBook within days of receiving his first loan payment.
Record numbers of students will be starting university in August and MP David Willets predicts that demand for university education will grow by another 25% in the next 20 years. The levels of non EU students who demand luxury accommodation and contribute heavily to the economy through spending are also rising, with off campus spending by this group reaching £3.4 billion in 2011/12 (Universities UK, 2014)...
Article by Pete Viney