Every year, millions of newly graduated high school students leave their parents’ homes to start their new lives as college students, and they all need housing.
But in recent years, the housing market has faced significant challenges, with affordability becoming a pressing issue nationwide. While large-scale developers often dominate the conversation, it’s important to recognize that small-scale developers, with their ability to focus on niche markets and tailor their projects to specific demographics, play a crucial role in addressing the affordable housing crisis.
The Gap of Affordable Student Housing
The need for affordable student housing is constantly growing.
In 2023, 18,939,568 students were enrolled in postsecondary education, but many universities cannot meet the demand for student housing. Over the past 15 years, the University of South Carolina has seen a significant increase in its student population — more than 52,000 students are enrolled across its eight campuses — and more students are enrolling for the 2024-2025 school year each day.
However, the university’s on-campus housing capacity has yet to keep pace with this growth. USC has added about 2,840 beds to its housing stock. As a result, just over one-third of USC students can secure on-campus housing. This means that students are racing to find alternative housing off campus but are met with the choice between high-priced apartments and townhomes near campus or less-than-desirable options further away from campus life.
With occupancy rates nearly at capacity across the nation, one thing is certain—developers can capitalize on the market gap and provide an alternative, affordable housing solution.
5 Ways Developers Can Capitalize on The Student Housing Gap
1. Tailor Solutions to Specific Student Needs
Small-scale developers have the advantage of being able to focus on niche markets and tailor their projects to specific demographics, and when it comes to student housing, understanding student preferences is the secret to leveraging this lucrative market.
According to a Multifamily Executive survey conducted by J Turner Research:
- 76% of students prioritize having access to their own bathroom
- 44% value big closets and storage spaces
- 24% prefer large kitchen areas
- 23% desire large living rooms
- Only 6% prioritize counter space
- A mere 2% consider wall-to-wall carpeting important
With this knowledge, small-scale developers can design housing solutions that meet these specific needs while maintaining affordability.
2. Build Near Campus
You know what they say: it’s all about location, location, location.
In the same study by J Turner Research, only 22% of participants said they would consider living more than five miles away from their campus.
Pro Tips
- Look for properties within walking distance of campus (ideally within 1 mile) or along major public transportation routes.
- Be sure to consider proximity to popular student amenities like libraries, cafes, grocery stores, and recreational facilities.
3. Incorporate Technology
We all know that Gen Z prioritizes their technology, and when it comes to campus life, technology isn’t just for fun — it’s essential for academic success.
Pro Tips
- Consider implementing smart home features like keyless entry systems, smart thermostats, and app-controlled lighting.
- Install USB charging ports in common areas and individual units.
4. Focus on Affordability
With limited on-campus options, providing affordable off-campus housing is key.
Pro Tips
- Explore innovative construction methods like modular or prefab building to reduce costs and construction time.
- Consider a mix of unit types, from more affordable shared suites to premium single-occupancy apartments.
5. Create a Community Atmosphere
Creating a sense of community can attract students while improving their satisfaction and increasing retention rates.
Pro Tips
- Design common areas encouraging interaction, such as lounges, game rooms, or outdoor gathering spaces.
- Incorporate collaborative study spaces that facilitate group projects and peer-to-peer learning.
The Future of Affordable Housing
The student housing market presents a golden opportunity for small-scale developers to make a significant impact while reaping substantial rewards. As the gap between university-provided housing and student populations continues to widen, the potential for innovative, well-designed off-campus housing has never been greater.
At Allison Ramsey Architects, we recognize small-scale developers’ unique position in addressing this critical need. Our diverse building types and designs are specifically crafted to exceed student housing expectations, ensuring a positive impact on students’ college years.
Whether you’re new to student housing development or looking to expand your portfolio, we’re here to help you navigate the challenges and capitalize on the opportunities in this booming market.
Connect with us today, and together, we’ll shape the future of student living.
