Australia Takes Proactive Steps to Improve Affordable Housing Options for International Students
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Australia's thriving education sector has led to increased demand for student accommodation, creating a housing challenge. Rental costs have risen by 10-20%. However, the student housing market, valued at AUD 10 billion, offers promising off-campus options (90%) and on-campus choices (10%). Despite these challenges, the growing market indicates a promising future for accessible and comfortable student living.
Australia has been quite gaining a huge inflow of international students in recent years. As of March 2023, the international students enrolled for different programs or courses witnessed a surge of approx. 27% compared to 2022.
In Australia, the health and education sector stands as the second-largest industry, making a significant 13% contribution to the country's overall output. The increasing global demand for Australian education has created an urgent requirement for student housing that is both affordable and of excellent quality.
International Admissions are Skyrocketing in Australia Resulting in the Huge Housing Demand
The surge in bed demand can be attributed to international students, constituting a substantial 76% of the student housing market size in 2023. Among them, Indian students represent 17%, the second-largest group after China, accounting for 22% of the international student population.
In 2023, India's international student enrollment witnessed a remarkable 28% increase, while China experienced a slight decline of four percent. The graph below represents the increasing Indian student population in Australia
*Source: Business Standard
Beyond Beds: Decoding Australia's Student Housing Market – Report by University Living
According to the latest report from University Living, titled "Beyond Beds: Decoding Australia's Student Housing Market," the country's student accommodation sector is experiencing remarkable growth, reaching an estimated worth of AUD 10 billion with a 17% CAGR.
Factors such as rising rental costs (10%-20%) in major cities, limited bed availability, escalating living expenses, lack of awareness among international students, construction and supply constraints, unregulated private rentals, and inadequate on-campus accommodation contribute to the ongoing housing crisis.
On-campus accommodation accounts for 10% of the market, while the remaining 90% comprises off-campus options.
The table below provides a quick glimpse into the number of beds as per the stay types in Australian student housing
| Accommodation Type | Number of Beds |
|---|---|
|
University Managed (across 42 universities) |
Over 60,000 |
|
Purpose-Built Student Accommodation (PBSA) |
Around 90,000 |
|
Occupancy by Domestic Students (PBSA) |
Approximately 26% |
|
Occupancy by International Students (PBSA) |
Approximately 74% |
|
Private Rentals |
Around 360,000 |
|
Homestays |
Approximately 100,000 |
Distribution of Student Housing by City
The significant demand for student housing in these cities stems from their sizable young population and the increasing influx of international students.
| City | Occupancy Rate | Rental Rate Increase (%) |
|---|---|---|
|
Sydney |
98% |
10% |
|
Melbourne |
97% |
8% |
|
Brisbane |
96% |
6% |
|
Perth |
95% |
5% |
|
Adelaide |
94% |
4% |
Additionally, it's worth noting that Sydney, Melbourne, and Brisbane collectively dominate the market share with a combined share of 79% out of the 400,000 beds available.
Australian Government’s Initiative to Curb the Housing Inflation
Amidst the challenges, there is a potential silver lining, with the Australian government taking proactive steps to enhance the housing supply. They have set a target of constructing one million new homes starting in 2024.
Additionally, the government is providing increased incentives for long-term rentals and investment in social and affordable housing.
Simultaneously in the recently held National Children and Homelessness Conference, Honorable Minister Ms. Julie Collins (Minister of Housing, Homelessness, and Small Businesses) addresses the prevailing Housing challenges and the measures taken by the government to curb the high housing insecurity among students.
*Source: Twitter
On a positive front, the Australian government has taken steps to support international students further. They have extended the permitted working hours for international student visa holders, allowing them to work up to 48 hours a fortnight starting from July 1. There are exceptions for students working in aged care, who can work beyond this limit until December 31, 2023.
Also Read: Cost of Studying In Australia For Indian Students
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