Three waves of COVID-19 wreaked havoc across sectors, forcing the education sector to go online. With vaccination for youngsters picking up and colleges and education institutions reopening, the student housing sector is expected to recover faster this year.
While the organised sector players are involved in managing on-campus and off-campus facilities, those in unorganised sectors are gearing for hosting the new batches from August.
“Apart from leasing new private facilities, several operators are entering the market, especially via digital platforms to manage the on-campus facilities and provide for the much-needed amenities along with safety and security. While stand-alone student housing is still in an incipient stage in India, going forward we see a lot of scope for more holistic, regulated and quality facilities to gain ground across major educational centres in the country," said Ankita Sood, Head of Research, Housing.com, PropTiger.com and Makaan.com.
While the organised sector is witnessing increased demand, almost equal to the pre-pandemic levels, the unorganised sector is witnessing a mixed response due to many institutions focusing on online education, the fear of the fourth wave as well as delay in board exams. This, they say, will eventually delay new admissions and impact their business.
Unorganised Sector Awaiting Demand RevivalAnil Tyagi, a property broker operating in Delhi's Laxmi Nagar, said that demand is yet to pick up. "There is only 10
percent demand at present. The fear of COVID-19 is still affecting business. The fact that most offices and colleges have gone online has further impacted business,” he said.
Shama Roy, who runs a paying guest accommodation out of a rented place in Delhi's North Campus area, said that the demand will crash after May 30. "There was a surge in demand during April and May. But it will be zero after 10 days as board exams for Class 12 have been delayed. Since Class 12 exams and results are both delayed, we are not expecting any demand in the next couple of months. We will be under pressure to pay rents during the next few months as the demand will revive only from August," said Roy.
In Rajasthan's Kota, an education hub for medical and engineering entrance examinations, property brokers said that the demand is reviving but is yet to reach pre-COVID levels.
"The demand has picked up but the frequency is low. However, it's 40 percent less than pre-COVID levels. We are witnessing demand for both single-occupancy units as well as shared units," said Milan, a property broker based in Kota.
Organised Sector Expecting Robust Demand
However, the student housing market is looking up for the organised sector. Sriram Chitturi, founder of Guesture and founding president of the Rental Housing Association of India, said that the demand is back to normal. He said that the New Education Policy will further push the graph up.
"Colleges are opening up and the demand is almost back to normal pre-COVID levels. The New Education Policy is also expected to boost demand with colleges all set to offer new courses. This may lead to increase in the number of students and the need for more housing facilities," said Chitturi.
Jai Kishan Challa, CEO and founder of Curated Living Solutions said that the demand has gone up for single rooms.
"Currently, most of our properties are operating at 45 percent single occupancy....Right now the admissions are happening and parents are coming to inspect the properties. We are witnessing a trend where people are upgrading by one level. If their budget was for a quad-share, they are pushing to occupy a three-share and those in three-share want twin-share and twin-share are looking to move into single occupancy. However, July will be the right time to assess the demand trend," said Challa.
He said that there is high demand at present as supply has not increased. "People are still speculating. Any property which gets launched in Bengaluru or Pune takes less than a month to reach 80 percent occupancy. I am assuming that this is happening due to the new supply not being ready due to various reasons. Landlords might be considering various options as well such as renting to co-living vs renting to a family. All of them are once bitten, twice shy," said Challa.
Deepak Anand, co-founder and CEO of Housr, a co-living startup, said that it registered a 10 percent growth in demand.
"With the initiation of the new session, there has been a 10 percent surge in demand by students. Several A+ and A grade colleges have approached us to set up the facilities near their college campus," said Anand.
But are student housing firms ready to cope with another wave of COVID-19?
Challa said that while the fourth COVID wave may certainly come, he hoped that there won't be too much damage. "As a world and as a nation, all of us are prepared to face COVID head-on. We are proactive and I see at least 50 percent of people wearing masks at present. We are more prepared to face it. Even if it is a dangerous variant, I don't see us going into a lockdown kind of situation and putting the economy on the back-burner. Also, there are enough medicines to treat this. The fear has reduced now," he said.
Chitturi said that while the non-organised sector might have challenges, the organised sector is better placed.Housr CEO Anand said that the company had witnessed a 10 percent drop in occupancy rates during the second wave. "If COVID-19 were to hit in the near future, we are fully prepared as we provide a safe environment where students prefer to live rather than return to their hometowns," he said.