Student Housing Blog

Rental Price Trends in the UK: Which Cities Are Seeing the Biggest Increases?

Student Housing Blog

May 19, 2025

Author :

amber

May 19, 2025

Student Housing

With over 2.9 million students enrolled in UK higher education, the student accommodation sector is under intense pressure. Purpose-Built Student Accommodation (PBSA), HMOs (Houses in Multiple Occupation), and private rentals are all facing shifting demand, changing student budgets, and volatile visa policy impacts. But perhaps the most noticeable impact is on rental prices, especially in major student cities in UK.

This blog dives into the UK’s city-wise rental trends for 2024 and 2025, based on insights from the amber UK Student Housing Annual Report 2024–25 and wider market data. We’ll examine which cities are experiencing the sharpest rent hikes, what’s driving these trends, and what it means for students, landlords, and investors.

Market Snapshot: The Rising Value of Student Accommodation in UK

The UK student housing sector is booming, with a projected market value rising from £7.35 billion in 2025 to £9.59 billion by 2030 (CAGR of 5.45%). However, with limited growth in PBSA supply and increasing student demand, especially in cities with top-ranking universities, rental rates have surged.

Despite over 258,000 new PBSA beds added in the past decade, demand far exceeds supply. As of 2024, the student-to-bed ratio (STBR) remains highly skewed in cities like Glasgow (3.8 students per bed), showcasing significant pressure on rental markets.

UK Student Housing Market Overview

Market Size (2025): £7.35 billion
Expected by 2030: £9.59 billion
Annual Growth Rate: 5.45% CAGR
PBSA Beds (2023): 740,000 (414K private, 325K uni-managed)
Total Student Population: 2.93 million+
Demand Gap: ~600,000 spaces short

Top Cities with the Highest Rental Price Increases

1. London: Still on Top with Consistent Increases

Average Rent Growth (YoY): 25% (2023), ~5% (2024 correction)
2024 Room Type Growth:
- Ensuites: +29%
- Studios: +5%
- Non-Ensuites: +20%

London remains the UK’s most expensive student city due to its global university presence, limited supply, and immense international demand. Despite a slight market correction in 2024, launch prices still rose by 29% for ensuites and 19% for studios in the 2025 cycle. The city also has one of the highest PBSA occupancy rates and sees strong long-term investment interest.

Why?

Global reputation (Imperial, UCL, KCL)
High visa retention from China and the US
Limited land availability for new development

2. Manchester: A New Favourite with Surging Demand

2023 Rent Growth: ~30%
2024 Correction: ~10%
2024 Room Type Growth:
- Ensuites: +41%
- Studios: -13%
- Non-Ensuites: +22%

Manchester’s rent prices surged over the last few years, thanks to strong international student inflows and limited affordable housing. Despite launching 7,400+ new beds between 2023–2024, demand still outpaces supply, particularly for premium accommodations.

Why?

Ranked among the UK’s most student-centric cities
University of Manchester and Manchester Met attract global attention
Strong transportation, tech, and creative industries

3. Glasgow: High STBR, Strongest Studio Demand Spike

Student-to-Bed Ratio: 3.8
2023 Rent Growth: -60%
2024 Growth:
- Ensuites: Flat
- Studios: -13%
- Non-Ensuites: -6%

Despite slight reductions in 2024 prices due to delayed bookings and affordability pressure, Glasgow remains one of the hottest rental markets. High STBR indicates unmet demand and strong competition for limited units.

Why?

Major universities: University of Glasgow, Strathclyde
Visa-friendly city for students from South Asia
Limited PBSA development pipeline

4. Newcastle Upon Tyne: Underrated Yet Growing Rapidly

2024 Room Type Growth:
- Non-Ensuites: +23%
- Studios: -14%
- Ensuites: -3%

Newcastle is climbing the ranks due to affordability and strong university infrastructure. It has emerged as a secondary hotspot for students who can’t afford London or Manchester prices but still seek quality education and lifestyle.

Why?

Students priced out of London and Manchester
More affordable PBSA inventory

5. Leeds: Volatile Studio Pricing

2024 Room Type Growth:
- Ensuites: -9%
- Studios: -38%
- Non-Ensuites: +4%

Leeds saw a notable drop in studio rental prices (–38%), suggesting saturation and students shifting to more budget-friendly options. Still, the city remains a major student hub with more stable prices for shared accommodations.

Why?

Oversupply in studios
Students shifting to shared options due to affordability concerns

Other Notable Student Cities in UK

Other_Notable_Student_Cities_UK.csv
City	Ensuite Price Trend (2024)	Studio Price Trend (2024)
Coventry	–13%	–26%
Liverpool	–7%	+1%
Nottingham	-10%	–5%
Sheffield	+4%	–17%
Birmingham	-	+8%

Key Trends Behind the Price Movements

1. Delayed Bookings & Market Corrections

In 2024, many students booked later in the cycle (post-June), forcing providers to drop prices. Despite early launches, price-sensitive students from countries like India and Nigeria waited longer, leading to a sharp mid-season decline in rates in cities like Coventry, Nottingham, and Sheffield.

2. HMO Popularity Rising

HMO listings accounted for 80% of domestic student bookings and 50% of Asian student views, thanks to lower prices (£150–£178 pppw) compared to PBSA (£175–£235 pppw).

3. Shift Toward Affordable Cities

Cities like Sheffield, Nottingham, and Leicester saw a larger share of bookings from students in lower rental brackets. In Sheffield, for instance, 28% of Indian students booked properties under £200 per week.

Launch Price Trends for 2025–26

Early 2025 Launch Prices (YoY Growth)

Early_2025_Launch_Prices_YoY_Growth.csv
City	Ensuite	Studio
London	+29%	+19%
Glasgow	+29%	+25%
Manchester	+6%	+7%
Leeds	+30%	–19%
Newcastle	+20%	–
Nottingham	+3%	+24%
Sheffield	+9%	+4%

These numbers reflect bullish investor sentiment and renewed optimism in early bookings for the 2025 season.

The Affordability Gap: Who’s Paying More?

According to amber’s nationality breakdown:

UK domestic students: 76% book between £150–£250 pppw
Indian students: 71% in the same range
Nigerian students: 86% prefer budget housing
Chinese students: Over 56% book £250–£350+ pppw properties

This suggests Chinese students prioritise university rankings and convenience, whereas Indian and Nigerian students lean heavily toward budget-friendliness.

Outlook for 2025–26: What to Expect

Supply Correction Ahead: More PBSA units are planned for cities like Manchester and Glasgow, which may stabilise prices further.
London Will Remain Expensive: However, growth will be more controlled due to saturation and stricter affordability.
Smaller Cities on the Rise: Nottingham, Leicester, and Sheffield are becoming havens for budget-conscious students.
Dependent Visa Policy Will Continue to Influence Demand: Countries like Nigeria (where applications dropped by 46%) may continue shifting to HMOs or deferring studies altogether.

Conclusion

UK student rental prices are anything but uniform. While cities like London and Manchester are seeing premium growth due to global prestige and demand, others like Coventry and Leeds are witnessing price corrections. Students, operators, and investors alike need to monitor these dynamics closely, especially as policy shifts and global inflation continue to influence affordability.

The bottom line? Affordability, flexibility, and location remain the top drivers of student rental choices. Cities that strike the right balance are the ones poised to thrive.

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Uploaded On

May 19, 2025

last updated on

May 19, 2025