Performance Can Vary Largely Across One State
Digested from RealPage
An inspection of two major universities in the same state shows how supply can impact off-campus housing performance.
While universities in Texas may have many things in common, student housing performance is not one of them, according to RealPage’s Julia Bunch.
Some schools have not seen many new completions, while others are facing serious supply concerns.
One school that has become synonymous for new supply is Texas A&M, which saw the delivery of more than 2,600 beds (a 10-percent increase) in 2018. That supply caused a 3.7-percent decline in rents in 2018.
“Privately owned student housing occupancy softened noticeably from 2015 [97.5 percent] to 2017 [92.5 percent] when more than 8,700 beds were delivered over those three years,” Bunch wrote. “Since 2017, occupancy has been creeping up as rent change dipped to the lowest it’s been in this economic cycle. A&M has one of the highest off-campus bed-to-full time undergraduate enrollment ratios of the nation’s most prominent universities at 68 percent.”
The University of Texas at Austin, on the other hand, saw just 500 beds added to its off-campus housing stock between 2015 to 2017. In 2018 things turned when 1,480 beads were added.
“That’s the biggest volume of new supply UT has seen in several years, and a number that will very nearly repeat in 2019 as another 1,420 beds are scheduled to complete,” Bunch wrote. “Despite increased supply, rent growth remains the highest of the major Texas universities at 3 percent. Occupancy wasn’t too damaged by elevated new supply either, falling a mere 30 basis points in 2018 to stand at 94.5 percent. At 52.1 percent, UT also has one of the higher ratios of off-campus beds to full-time undergraduate enrollment among the nation’s most prominent universities.”