Student Housing in Transition: From Growth to New Pressures
The 2024–2025 academic year saw the biggest gains in higher education enrollment.
Student housing followed, with near-record absorption, high occupancy, and solid rent growth.
With declines in the number of U.S. high school graduates on the horizon, ongoing visa delays, and rising construction costs, student housing now faces a more complex and uncertain chapter.
After pandemic-related setbacks and only a partial rebound, U.S. higher education entered the 2024–2025 academic year on stronger footing. National enrollment climbed 4.5 percent from the prior fall, pushing the total student population above 19 million. By most measures, it was a strong year. Yet beneath the headline numbers lie demographic shifts and policy changes that will shape the road ahead.
Among the RP 175 universities (the original 175 investment-grade universities tracked and forecasted by RealPage), enrollment rose by roughly 104,000 students in 2024, a 2.3 percent increase. Much of that growth stemmed from federal aid changes: FAFSA (Free Application for Federal Student Aid) was simplified, and Pell Grant eligibility expanded, adding nearly 1.5 million students. Still, the gains weren’t evenly spread. Just 10 universities accounted for nearly one-third of the growth, with half of those in the South, while more than one in five RP 175 schools lost students, including a few major universities. Larger institutions tended to outperform smaller ones, with the 20 biggest universities that grew reporting an average enrollment growth of 3.5 percent, compared with 2.4 percent for smaller campuses (the 20 largest universities with fewer than 12,000 students).
Demographics were also a key driver of the 2024 enrollment surge, with approximately 3.8 million students graduating from U.S. high schools that year. The size of this cohort boosted application volumes to higher education and pushed the average acceptance rate at RP 175 universities down to 70.5 percent, the lowest since 2019. The class of 2025 grew even larger, reaching a record 3.9 million students—but that peak marks a turning point. Beginning in 2026, the number of high school graduates is projected to decline steadily, potentially as much as 13 percent by 2041. The impact will vary regionally: states such as Florida, Tennessee, and Texas are expected to continue growing, while much of the Midwest and Northeast will likely see declines.
Beyond domestic trends, international students played a key role in 2024. Preliminary estimates indicate that nearly 1.2 million international students enrolled in U.S. institutions during the 2024–2025 academic year, a record high. These students are essential both for research and institutional finances, since many pay full tuition. However, early 2025 data suggest a shift in momentum. Visa delays and stricter vetting have slowed arrivals, with projections pointing to a 15 percent decline in international enrollment. Between January and April, F-1 visa issuance dropped 12 percent year over year, widening to 22 percent by May.
That slowdown won’t be felt equally. At the 50 most selective public universities, international students account for about 11 percent of enrollment. At some private and public institutions, reliance on international students is much higher: Columbia University’s share is close to 40 percent, NYU’s is 37 percent, University of Southern California’s is 28 percent, University of Illinois’s is 23 percent, and University of Michigan’s is 17 percent. These campuses stand to feel the pinch most acutely, particularly as domestic pipelines shrink.
Meanwhile, global competition for students is shifting. Canada has capped study permits 10 percent below 2024 levels, while the United Kingdom has restricted dependent visas and shortened post-study work opportunities. On the surface, these changes could make U.S. universities more attractive. But that advantage is anything but guaranteed. If visa processing remains slow or post-study work policies become more restrictive, the United States could quickly lose ground.
Universities once offset declines in international enrollment by admitting more domestic students. That worked when the pool of high school graduates was growing. But with that pool now shrinking, the safety net is gone. U.S. higher education now faces a squeeze from both sides: fewer domestic students at home and more uncertainty abroad. These pressures could slow enrollment growth and cost institutions billions of dollars in the years ahead.
Alongside these recent enrollment peaks and shifts, student housing fundamentals also recorded strong results in 2024. Occupancy among purpose-built beds in RP 175 universities reached 96.2 percent, just shy of record highs, even with thousands of new beds added. The strongest performance came from Southern universities, followed by campuses in the Midwest, while schools in the Northeast and West lagged. That marks a reversal from the pre-pandemic years, when the Northeast and West consistently posted the highest occupancy rates. With new restrictions on international students, occupancy is expected to slip at the campuses that depend heavily on them, many of which are concentrated in those same Northeastern and Western markets.
Rents followed a similar pattern. At RP 175 universities, average rents climbed 6 percent in 2024; solid growth, though down from the 9 percent jump in 2023. Unlike conventional multifamily housing, some campuses with the heaviest supply growth also recorded the strongest rent gains. Still, as rents climbed, so did concessions, averaging 8.5 percent of asking rent per bed, the highest since 2015, and more than one-third of beds (36.2 percent) now include concessions—the most since 2021.
On the supply side, 2024 saw one of the biggest delivery waves of the past decade, with more than 38,000 new purpose-built beds completed. More than half were delivered at just eight universities, four of which are in the South. Still, the pipeline is thinning rapidly. Only 22,000 beds are expected to be delivered in 2025, a 42 percent decline. The slowdown should help support occupancy and rent growth, especially given that roughly 52,000 beds were absorbed in 2024, the strongest demand since 2015.
The sharp pullback in the 2025 pipeline is no coincidence—it’s a clear sign of growing caution mounting across the industry. Developers face a new set of challenges. In mid-2025, tariffs on steel and aluminum doubled and expanded to include HVAC systems, machinery parts, and other essential building materials. These items make up a significant portion of student housing construction costs, meaning each new bed is now far more expensive to deliver. Skilled labor remains in short supply, adding to the pressure, and insurance premiums continue to rise, especially in coastal and disaster-prone areas. On top of that, tighter bank lending is making it harder to finance and execute new projects.
Taken together the story of 2024 was one of resurgence. Simplified federal aid, a record-high graduating class, and strong international enrollment drove the biggest gains in years. Student housing followed, with near-record absorption, high occupancy, and solid rent growth. But with demographic declines on the horizon, ongoing visa delays, and rising construction costs, student housing now faces a more complex and uncertain chapter.
—RealPage
