Student accommodation crisis looms in Hong Kong amidst housing shortage

Currently, the private student housing market can only accommodate 0.4% of the total enrolled population.

In the next 4 years, post-secondary university hostels in Hong Kong will create additional spillover demand of 22,300 bedspaces into the private accommodation market, JLL reported.

This in turn will fuel private student accommodation to be a new investment asset and boost the investment value of hotels and residential properties repurposed as student accommodation.
 
In the 2022/23 academic year, post-secondary student enrolment in Hong Kong reached 253,000 and the 8 University Granted Committee (UGC)-funded universities, along with Hong Kong Shue Yan University and Hong Kong Hang Seng University provided approximately 39,000 units of student accommodation whilst the market could only accommodate 16%. 

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JLL estimates around 37,300 non-local students currently opt for private accommodation and expects it to expand to 59,500 in the next 4 years which the market may struggle to accommodate due to the lengthy construction cycle of purpose-built hostels.

Currently, the private student housing market in Hong Kong is only providing around 1,000 total leasable spaces, accommodating only 0.4% of the total student enrollment. Each of these units costs around $5,200 to $14,800 per month.
 
“Rental prices in Y83, the largest private student accommodation in the city, recorded an annual growth rate of over 10% since 2022. We observed that the rents of private student accommodation are soaring at an accelerated pace in the last 12 months and reached 15%, the highest. The rents of private student accommodation are expected to grow further as the demand for student accommodation is currently underserved and the population of non-local students is growing rapidly,” Oscar Chan, Head of Capital Markets at JLL in Hong Kong said.