Trends Reshaping Off-Campus Student Living
Campusville's Andy Gutman on the key issues to watch.
Postsecondary enrollment is on the rise. According to HUD, there has been a surge in college enrollment over the past 15 years. HUD data indicates that more than 70 percent of Americans now enroll at a four-year institution.
This steady increase in enrollment has brought the need for more and better student housing options into sharper focus. The asset class, which has long served as a reliable niche for commercial real estate investors, is seeing renewed interest. Recent demographic indicators suggest that off-campus housing is entering a period of sustained demand. With fewer than 25 percent of college students living on campus, and with many universities not currently expanding their residential capacity, private student housing owners and operators are being tapped to meet the needs of the growing student population.
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However, meeting this demand isn’t as simple as just adding supply. Long-term success in this space depends on selecting the right markets, investing in the right assets, and avoiding trends that don’t deliver lasting value.
At Campusville, we’re closely tracking how demographic shifts, urbanization, and evolving student expectations are influencing the increased appetite for student housing. Here are several key considerations and best practices that owners and operators should keep top of mind.
Why on-campus housing isn’t keeping up
The U.S. college student population tends to remain stable even during economic downturns. In fact, data from the U.S. Bureau of Labor Statistics shows that enrollment often increases during recessions, as individuals look to reskill or delay entering a challenging job market. That pattern has helped student housing outperform other property types in tough economic cycles.
However, the number of on-campus beds hasn’t kept pace with enrollment growth, leading to overcrowded dorms, waitlists and, in some cases, temporary or inadequate housing. Many universities simply don’t have the resources to expand in the face of tight budgets, competing infrastructure priorities, and limited land availability. On top of that, some have opted to fully outsource housing to private-sector partners.
In addition, demographic shifts are straining supply. Encoura reports that Gen Alpha—the next wave of college-bound students—is projected to be larger than Millennials and Gen Z. At the same time, enrollment gains have been concentrated at public universities and Power Four conference schools, many of which are located in rapidly expanding metropolitan areas, according to National Student Clearinghouse research. That concentration is putting even more pressure on housing near those campuses.
What students really want
The student housing market used to be driven by qualities such as proximity, price and availability. While those factors still matter, today’s student is more discerning. Gen Z students expect more than four blank walls and a twin XL bed. They are looking for amenities that align with their academic and social lives. Think tech-enabled group work rooms, social lounges, quiet zones, and flexible fitness options. These offerings create real value and drive leasing velocity.
Technology also plays a significant role in shaping the student experience. Gen Z and Gen Alpha are digital natives. That means, for these generations of students, technologies such as high-speed Wi-Fi, keyless entry and smart thermostats no longer feel like luxuries. They’re baseline expectations—and students assume that they will be present. What truly differentiates a property in these students’ eyes is its ability to promote community and connection through amenities like co-working spaces and wellness-oriented offerings.
Designing with purpose
Beyond practical and communal spaces, students want their housing to reflect their values. Research by McKinsey & Co. shows that Gen Z is a deeply purpose-driven generation that prioritizes sustainability, wellness and community. However, some of these values motivate renters more than others. Eco-friendly upgrades like smart HVAC systems and energy-efficient lighting are beneficial for operational cost savings and environmental stewardship. However, in our experience, they rarely drive leasing decisions. Instead, students gravitate toward lifestyle-focused amenities such as communal lounges, group study zones and shared social spaces.
Wellness, on the other hand, tends to resonate more with renters. Amenities like quiet zones, fitness areas, natural light, and green spaces are known to contribute to healthier living environments, and can translate to better student performance and satisfaction. Operators should also make sure their properties are accessible, inclusive and able to accommodate students of all backgrounds and abilities. Students who feel a sense of belonging are more likely to succeed academically, according to research from the Society for College and University Planning.
Knowing your market
Student housing isn’t one-size-fits-all, which means success starts with knowing your market. A common pitfall is over-investing in amenities that students don’t use or aren’t willing to pay for. These preferences often vary widely by campus and region, which means understanding both the current student population and future trends, including enrollment forecasts, rent expectations and competing properties, is essential.
Pay attention to factors such as which colleges and universities are growing, which might be investing in campus expansions and which student groups are most likely to live off campus. Rising construction costs and tighter lending standards should also play a significant role in how operators think about upgrades.
Lastly, not all campuses are on the same trajectory when it comes to enrollment or housing needs. Flagship institutions—particularly those in urban settings—continue to attract strong student numbers and sustained interest in off-campus housing. In contrast, many smaller or regional schools are seeing enrollment declines that may challenge the long-term viability of housing investments. Careful underwriting is critical to avoid overcommitting to a market with an uncertain future.
Student housing remains a resilient, high-performing asset class—especially near major university campuses. Making smart decisions in a landscape shaped by enrollment fluctuations and evolving student expectations requires a clear understanding of demographic shifts and localized leasing dynamics. For investors and operators, the challenge lies in capturing the current demand for off-campus housing without overcapitalizing on trends that don’t translate to sustained value.
Andy Gutman is president of Campusville, a student housing company that offers property management, maintenance, development, construction and investment sales for off-campus student housing.
