‘I didn’t know what to do’: collapse of providers of high-end digs leaves students in shock
Purpose-built student accommodation (PBSA) providers across the UK are collapsing as a cost of living crisis, falling international student numbers and rising construction costs squeeze their finances. The collapse has forced students like Nathalie Sriwiboonrattan, a fourth-year game design student at Abertay University, to scramble for alternative housing mid-term; nearly 70 students in Dundee lost accommodation when Marketgait Apartments' owner went bust in late July. This crisis exposes a fundamental affordability problem: premium housing blocks built for wealthy students now sit half-empty, whilst affordable options become increasingly inaccessible.
National average PBSA rents outside London are £191 per week including bills, but en suite rooms in Manchester command £170–£320 weekly, and London accommodation ranges from £250–£650 per week for en suite to £550–£800 plus for studios. British students' maintenance loans have failed to keep pace with these rising costs, whilst international students face the additional barrier of capped 20-hour working weeks during term time. University-owned accommodation typically costs £660–£770 monthly with bills, whilst shared private rentals have also become prohibitively expensive, leaving many students with no viable options.
- Multiple UK student housing providers have collapsed this year
- Premium dorm rents now exceed what most student loans cover
- International and home students increasingly struggle to afford quality accommodation
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Purpose-built student accommodation, or PBSA, refers to housing blocks specifically constructed for students by private companies rather than universities. Across the UK, many of these providers are now collapsing financially due to the cost of living crisis, declining international student numbers, and rising construction costs. When these companies fail, students can find themselves without housing and forced to search for alternatives at short notice.
The core problem is that most expensive residential blocks were built assuming they would remain full with wealthy students able to afford high rents. International student numbers have fallen whilst British students face mounting living costs, meaning many blocks now sit only partially occupied. Providers cannot generate enough income to cover their costs and stay in business.
British students' government maintenance loans have failed to keep pace with rising rents, whilst international students are restricted to working only 20 hours a week during term time. University-owned halls of residence, which tend to be cheaper, offer limited spaces. The crisis reveals a fundamental mismatch: plentiful expensive student housing exists whilst genuinely affordable options become increasingly scarce.
Both sides, in good faith
The strongest fair case each way — we don't pick a winner.
The case for
Student housing affordability represents a market failure with immediate human costs. PBSA providers' collapse demonstrates that private developers build only premium accommodation, leaving a gap vulnerable students cannot fill. When students face mid-term displacement or cannot access higher education due to housing costs, waiting for long-term market correction proves inadequate. Universities should expand affordable provision, maintenance grants should increase to match actual costs, and new developments should face affordability mandates to ensure housing serves students rather than maximising returns.
The case against
This is a necessary market correction, not a crisis. Providers who built overpriced accommodation are rightfully failing; this clears the market for realistic developments at prices students can actually sustain. Rent controls and affordability mandates would discourage investment in new housing stock, ultimately reducing supply. Students retain alternatives—shared private rentals, living at home, commuting—and allowing market forces to operate will eventually produce housing at sustainable price points far more effectively than government intervention, which historically creates shortages and inefficiency.