In one final piece of good news the end of the Fall 2021 pre-lease season, occupancy surged as students moved into student housing.
As of September, 94.1% of student housing beds at the core 175 universities tracked by RealPage were occupied. This was a record high for the market. For perspective, the 90% threshold is considered healthy and essentially full, though that performance bar varies by university.
September occupancy was a sizable 200 basis points (bps) ahead of August’s final pre-lease rate of 92.1%. Though a notable climb between August and September is common as students sign last-minute leases and immediately move into apartments, the typical increase averages closer to 100 bps.
In 2020, September’s occupancy rate climbed 110 bps from August’s final pre-lease rate. In 2019, that rate was 130 bps. This year’s 200 bps-climb comes after a sluggish spring turned into a strong summer of pre-leasing. September’s final occupancy of 94.1% comes in 590 bps higher than 2020’s September occupancy reading and 130 bps higher than 2019’s September rate.
Throughout the last year, during the COVID-19 pandemic, the longstanding trend of rent growth performing better at properties closest to campus reversed itself. However, the trend of outperformance among pedestrian assets held true among occupancy readings.
At properties within a half mile to campus, September occupancy registered at 94.8%, the highest rate among the distance categories and about 70 bps higher than the U.S. average. Properties within a half mile to one mile of campus mirrored the overall average at 94.1%. September occupancy at properties more than one mile from campus registered the lowest, at 91.8%. Across all distances, September occupancy outperformed 2020 and 2019 rates.
In another measure of good news, September occupancy at individual schools improved as well. Among the RealPage 175, there were no true laggards. Over 120 of the 175 schools tracked registered September occupancy above the essentially full threshold of 90%. Of the handful of schools with September occupancy below 80%, nearly all are commuter schools or campuses working through years of elevated supply volumes.