The Student Accommodation Council (SAC) has welcomed the Reserve Bank of Australia’s (RBA) recent analysis highlighting the substantial growth of purpose-built student accommodation (PBSA) in response to rising international student demand.
The RBA report underscores that international students remain significant economic contributors to Australia, yet warns that housing supply has lagged behind this increasing demand.
PBSA has been identified as the best-placed housing type to provide large-scale solutions to this challenge.
The SAC praised the RBA’s explicit recognition that “higher international student numbers have generated a supply response” within the PBSA sector, noting rapid growth in development approvals and optimistic industry forecasts.
“More than most housing types, PBSA developments can deliver hundreds of student-only beds in a single project,” SAC Executive Director Torie Brown said.
She emphasised the capacity of these developments to ease pressure on the broader housing market.
“A typical new PBSA building adds around 700 beds to the market, easing pressure on inner-city rentals and freeing up homes for other renters,” Brown explained.
“This makes PBSA one of the most efficient and scalable ways to meet the housing needs of international students.
“It should be treated as a priority asset class by all levels of government, supported through planning systems, supportive rental legislation and investment frameworks.”
The RBA also clarified misconceptions surrounding the impact of international students on rental prices, stating that “the rise in international student numbers is likely to have accounted for only a small share of the rise in rents since the onset of the pandemic”.
This contradicts claims blaming international students for soaring rental costs, as rent increases coincided with periods when international student arrivals had plummeted.
Last year, the SAC released a report showing that capping international student numbers at the government’s previously proposed threshold of 270,000 would only reduce average metropolitan rents by around $5 per week — roughly the price of a cup of coffee — but would cost the economy $4.1 billion annually.
A further SAC report from November revealed that the growth in private PBSA supply has closely matched international student population growth.
Since 2015, international student numbers have increased by 75 per cent, while private PBSA beds have grown by 74 per cent.
“We would be better off focusing on increasing the supply of PBSA, which has already demonstrated an extraordinary ability to match the demand from international students,” Ms Brown concluded.
The findings underline the importance of continued government support for PBSA as an essential housing solution for international students and a key component of Australia’s education and rental housing sectors.