Why Real Estate Stakeholders Should NOT Ignore Student Housing?

Student Housing by Stanza
Student Housing by Stanza

India is a young country. And organized, easy-to-access, safe student housing is the need of the hour.

There are nearly 37 million students pursuing higher education in India. Out of this, an estimated 11 million migrant students have left their home and have gone to other cities to pursue their studies.

Be it infrastructure crunch or total lack of management or budget issues, on an average, only one-third of these students find accommodation in college-run hostels while the remaining 7 million are left to manage themselves. And with gross enrolment on the rise, the numbers are only going to increase in the coming times.

No wonder, college hubs like Noida, Greater Noida, north and south campuses in Delhi and areas around universities or colleges in other cities are infested with informally and often illegally run private hostels or paying guests accommodations.

Such housing models are often unaccounted for any safety and hygienic standards. The students putting up at these places have no choice but to adjust to sub-standards, questionable safety and often unexplainable hefty fees. Despite the slew of problems, they have no choice and no place to go.

And this is exactly where organized student housing swoops in. Formally run student housing can give millions of students and their parents what is important and need of the hour- a reliable trust-worthy brand name.

Student housing seems to be the win-win solution for both end users as well as the developers. While rental yields have stagnated at 2-3% in residential real estate, student housing presents attractive returns at 13-14% at a lower risk, with a potential upside in the case of premium housing, as per Vimal Nadar, Director in JLL’s Research team in Mumbai, India.

“The sector is plagued with issues relating to procurement of land (mainly in major cities), absence of development regulations, and lack of university support,” Nadar wrote for JLL. “Thus, there is an urgent need to create a regulatory framework that will ensure the establishment of collaborative business models for the growth of this segment.”

Here are some of the top student housing players that are present in this niche and nascent segment:

  • Stanza Living
  • Oxfordcaps
  • Placio
  • Zolo
  • Good Host Spaces
  • Simply Guest
  • Housr

Read on to find key challenges in Indian real estate.

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