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Melanie Leech, chief executive of the British Property Federation

A purpose built student living crisis on the horizon?

Planning system could constrain growth of higher education sector

Posted by Hannah Oakman | July 21, 2015 | People, policy, politics, money

The British Property Federation (BPF) has urged government to use its promised review of the Community Infrastructure Levy (CIL) to stop councils setting sky-high CIL levels, or risk constraining growth of the UK’s Higher Education (HE) sector.

In 'Making the Grade', its manifesto for the purpose-built student accommodation (PBSA) sector, the BPF highlights how enormous CIL contributions are being used tactically in London to stop PBSA development, by hurting the viability of schemes which deliver much-needed, high-quality accommodation for students.

It has urged the government to use its review of CIL in 2015 to provide stronger guidance on how PBSA is treated.  

The manifesto also points out a secondary impact of constraining PBSA supply; it will place further pressure on the already squeezed housing markets, as students will be forced into the traditional private rented sector.

It is estimated that PBSA across the UK could release 77,000 homes back on to the market.

The manifesto recommends exempting PBSA schemes already accredited through the Accreditation Network UK (ANUK) code from additional local authority licensing. It explains that as the ANUK code regulates PBSA to a standard expected and beyond that of local authorities, making this extra licensing is unnecessary.

It also recommends that government provide clarity on council tax, as the way councils handle it for PBSA differs wildly, and can often lead to students being inconsistently charged.

The purpose built student accommodation sector has played an integral part in allowing the higher education (HE) sector to expand over the past 20 years. The sector has grown considerably over the past two decades, and saw £2.1bn invested in the sector in 2013.

The HE sector attracts international students and develops the UK’s future workforce; in 2011/12 universities contributed over £36.4bn to UK GDP.

Melanie Leech, chief executive of the British Property Federation, commented: “A thriving PBSA sector is integral to maintaining our competiveness as a country which offers a world-class higher education system. Not only does it play an important part in attracting international students to our universities, but the high standards and security of the accommodation provide peace of mind for both students and parents, and allow universities to focus on first-class teaching and study facilities, rather than student halls.

“Because the sector is relatively new, there can be ‘grey areas’ in how it should be classified for policy purposes. We intend this manifesto to highlight the benefits of PBSA to both local and central government, and, consequently, to encourage them to consider how they might create a more supportive policy framework for the sector.”

A thriving PBSA sector is integral to maintaining our competiveness as a country which offers a world-class higher education system

Richard Simpson, chair of the BPF Student Accommodation Committee added: “Corporate providers of student accommodation and University halls make up just under a third of the market. This shortage of purpose built accommodation is exerting incredible pressure on the private residential market - homes which could be freed up for young families.

“Without the necessary accommodation and infrastructure we will be unable to support the growing number of students studying at our higher education institutions.

“The BPF manifesto highlights the challenges that developers are facing in trying to meet the shortage and with the removal of the student number cap this September government forecasts are predicting that the UK student population will increase by 100,000 in the next three years.

“We need good quality, purpose built accommodation that supports students success and provides them with a safe secure home in order to maintain our strong higher education reputation and share of the global student market.”

 

 

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