Student housing emerges new realty format

Rising enrolment, migration expected to drive demand for quality accommodation

Property Pulse

India's expanding higher education sector is creating a new opportunity for the real estate industry, with professionally managed student housing emerging as a fast-growing asset class.

According to a Knight Frank India report, rising student migration, increasing enrolments and the growing preference for studying within India are expected to significantly boost demand for purpose-built student accommodation over the next decade.

India has nearly 155 million people in the 18–23 age group, with around 53 million currently pursuing higher education. This number is projected to exceed 70 million by 2035 as universities expand academic programmes and more students enrol in higher education.

The growth is expected to increase demand for quality accommodation around universities, engineering colleges, medical institutions and other educational hubs. Knight Frank estimates that 15–17 per cent of inter-state migration in India is driven by education.

As student mobility rises, the country could require accommodation for more than 12 million students by 2035, highlighting the scale of the opportunity for developers and investors. The report also notes that rising overseas education costs and tighter visa regulations in several countries are encouraging more students to pursue higher education within India.

At the same time, international universities are planning campuses in India, while private educational institutions continue to expand, creating additional demand for organised student housing. The market is gradually moving beyond traditional college hostels, paying guest accommodation and rented rooms.

Professionally managed student housing now offers features such as 24x7 security, high-speed internet, housekeeping, nutritious meals, laundry facilities, study areas and recreational spaces, providing a more structured and secure living environment for students.

Unlike several other real estate segments, student housing benefits from recurring demand as fresh batches of students enrol every academic year. This predictable occupancy is attracting interest from developers and institutional investors seeking stable, long-term returns.

Shishir Baijal, chairman and managing director, Knight Frank India, said India's favourable demographics, expanding higher education ecosystem and increasing student mobility are expected to drive sustained demand for professionally managed student housing and encourage greater institutional investment in the sector.

Student Housing

• Higher education enrolment projected to exceed 70 million by 2035.
  
• Accommodation demand expected to cross 12 million students.
  
• Education accounts for 15–17 per cent of inter-state migration.
  
• Professionally managed student housing emerging as a new asset class.
  
• Education hubs expected to become the next real estate investment hotspots.