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Urgently expediting the development of PBSA should be a top priority for the incoming NSW government following the 25 March elections, an industry body warned.
The Student Accommodation Council stated that the “cumbersome” planning processes and foreign-investor land tax surcharges have become significant obstacles in the construction of new assets and discourage private investment in the purpose-built student accommodation (PBSA) sector.
Data from the council showed there are currently 16,500 PBSA beds in NSW, representing a ratio of 31 students per bed across the state.
In comparison, Victoria has 17 students per PBSA bed, while Queensland has 14 students per bed.
In light of the concerning figures, Student Accommodation Council executive director Torie Brown warned that students, particularly those who are hailing from overseas and returning in the wake of Australia opening its borders, are facing a “perfect storm”.
“[The] NSW rental market is incredibly tight; student accommodation buildings are at capacity, and more and more international students are returning to this overheated market daily,” she stated.
With current estimates showing that it takes a minimum of four years for a PBSA developer to go from land acquisition to students moving in, Ms Brown urged for government interaction for the whole development process to be accelerated.
“We need to increase the supply of student accommodation beds coming to market far quicker than that.
“The NSW government already has a precedent for expedited planning approvals for build-to-rent; we’re simply asking that PBSA be treated in the same way,” she said.
Ms Brown emphasised the advantages of PBSAs, such as secure living near universities and regulated management.
Additionally, she highlighted that an increase in the number of PBSA beds can offer a wider range of affordable room types for students and will alleviate rental cost pressures.
Student Accommodation Council president and Scape chief executive Anouk Darling said that focusing on PBSA developments has been observed in other states.
“Investors have seen forward-thinking authorities in other major cities around the world take action to promote the development of purpose-built student accommodation to combat housing shortages and provide high-quality accommodation quickly.
“We strongly encourage state governments and local councils to work with the sector to address the housing shortage facing students, before we risk Australia’s valuable reputation as a preferred destination for international education,” she said.
Ms Brown urged governments to prioritise building student accommodation to provide exclusive housing options for students, consequently preventing them from competing with families in the rental market.
“Expedited planning approvals, removing taxes like foreign investor fees and planning systems that prioritise student accommodation close to places of study should all be a top priority for policymakers,” she concluded.
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