Some 5,040 student accommodation units have been built in Belfast across 12 schemes since 2016, with another 1,237 beds due to be completed in 2024, and a further 3,773 units in planning.
But a new report from Lambert Smith Hampton (LSH) suggests the market is not yet saturated in Belfast due to the demand for purpose-built student accommodation (PBSA) anticipated by the two main universities.
Another seven PBSA schemes are in the planning system, with more under consideration according to the research from LSH.
Both Queen’s University and Ulster University have been acquiring property, which have been linked to potential PBSA schemes.
In a recent university led submission to Belfast City Council, the universities claimed 6,000 additional student rooms will be needed in Belfast by 2030 with the current supply at capacity.
UCAS are forecasting that there will be a 20% rise in Northern Ireland school leavers seeking university places by 2030.
But if they are to stay in the north, the Department for the Economy’s cap on student places will need to be lifted, which will almost certainly result in higher tuition fees.
LSH said that prior to the 2016 building spree, the ratio of students to PBSA bed spaces in Belfast was 10:1.
Claire Shaw, senior research analyst at the property firm said that was considered high compared to other UK university cities at the time.
“In other cities such as Liverpool and Sheffield this market is now highly saturated with ratios looking more like 2:1,” she said.
“We predict that the ratio in Belfast will be 5:1 by September 2024 which supports the suggestion that this is an appealing market for commercial real estate investors in Belfast over the coming years.”
But LSH warned that unaffordable rent, increased tuition fees and difficulties with visa applications for international students could negatively impact on the market in the long-term.
LSH said basic cluster rooms in Belfast currently average at around £150 per week, which is expected to rise by as much as 8% for the 2024/25 year.
The property firm’s director, Andrew Mearns, said: “Over the past eight years there has been a significant increase in the number of newly developed PBSA schemes across Belfast city.
“Primarily due to Ulster University relocating to the city, Belfast now benefits from a student population that is estimated to be around 45,000.”
“With this new market brings huge opportunity for investors. It’s still early and we are yet to witness any significant investment transaction volume but we predict this will change moving forward with PBSA occupancy levels now maturing.
“Growth in this market long term could feed into the future growth of build-to-rent in Belfast as students become graduates and young professionals.”
