Tuesday, 12 November 2019

"University to be turned into student housing"

OK, The Daily Mash is exaggerating, but there is a lot of truth in this.

The student's landlord makes a lot more profit than the universities they attend, who, taken as a whole together with Student Loans Company and the taxpayer, probably make a cash loss (which is fine, as long as higher education benefits society as a whole).

The Lad is now in halls on campus (two minute walk from front door to lecture theatre or laboratory block), cost £5,000 a year rent plus £9,250 tuition fees, and I'd rather the university makes the profit (or taxpayer takes a smaller loss) than some slumlord cashing in on owning something near a university.

But the university might as well just charge an all-in-price of £14,250, like at boarding school, where the fees cover education and accommodation, and have done with it.


Graeme said...

Student accommodation is becoming big business. Around 750,000 new students arrive each year and there are only 639,000 beds currently.

The same dynamics seem to apply as in domestic housing. Lots of land banking and a steady trickle of supply. However, much of the supply is pre-sold, giving lots of lovely cash-flow to the builders, such as Watkin Jones. From a recent article in Investors Chronicle

"Watkin Jones not only forward sold and completed all six PBSA developments (2,723 beds) in the 12 months to 30 September 2019, but has already forward sold all seven of the PBSA developments (2,609 beds) slated for construction in the 2019/20 financial year. Furthermore, 1,928 beds have been forward sold for delivery in the 2020/21 financial year and the directors are aiming to deliver an additional 1,300 beds in that 12-month period, too, of which agreed sales on 448 beds are in the hands of solicitors. The scaling up of the operation is part of a strategic plan to increase the delivery rate to 3,500 PBSA beds over the next five years."

Incidentally, the funeral people, Dignity, are saying that results are bad because of the "stubbornly low number of deaths in the first half of the year."

Was this because of or despite Brexit?

Mark Wadsworth said...

G, land value tax will sort them out.

I saw that funeral thing. Difficult situation for them, financially and PR-wise.

Bayard said...

I suspect that the universities not charging an all-in fee is a hangover from the days of free tertiary education, where they only charged for accommodation. Rather than change that arrangement, they simply added an extra department to charge for fees.