The future of international students in the UK and what this means for PBSA

The UK’s international full-time student population is at historic high levels, driven by factors including the Government’s 2019 international education strategy, academic reputation, and the two-year post-study work visa. However, the more recent introduction of restrictive government policy has interrupted the appeal of the UK as a study destination and is affecting recruitment. The most impacted universities are now being challenged financially given that institutions often use the uncapped tuition fees of international students to boost income.

The new Labour government has since reaffirmed international students are welcome and confirmed the post-study visas will remain, renewing positive and welcome sentiment towards international students. 

UCAS 28-day clearing analysis shows no change in international student undergraduate total acceptances year-on-year, but this varies by university calibre. Only higher tariff universities have increased acceptances of international students. In addition, Home Office data indicates a drop in study visas, which, combined with UCAS’ results, signals the policy impact may be felt mostly at post-graduate level and medium/lower tariff universities.

International students are major occupiers of PBSA, with HESA data indicating in 2021/22, 40% of international students lived in private PBSA. However, investors have recognised how responsive international student behaviours have been to recent government rhetoric. As a result, PBSA investors are increasingly looking at the breakdown of international students, their respective level of study, and the type of university attended at the micro-locational level. This places even greater pressure on the availability of data, which is being used to inform investor strategies. For example, investors may look to secure lower risk options to mitigate fluctuations in occupancy levels (as Unite has done by increasing its proportion of nominated stock from 53% to 57% in 2024/25).

There is now greater investor interest on emerging government policy on international students. Still, investors need to also consider the wider context. For example, in contrast to the UK, Canada and Australia have both introduced caps on student visas. Moreover, the U.S.’ student visa rate of rejection is increasing. Negative rhetoric is also appearing across areas of Europe, with Spain and the Netherlands dropping the number of English-taught courses to reduce international students.

Students who may have considered these locations may turn to the UK instead. In addition, our analysis of the total cost of higher education for an international student indicates the UK is a cost-effective option at around 15-30% cheaper than Canada, Australia, and the U.S.

The UK’s appeal on the global landscape is underscored by its lack of restrictions on recruitment of international students, its cost competitiveness against other major study destinations, and its reputation for providing quality education – evidenced by 16 universities being ranked in the 2025 QS top 100 world rankings.

Together with the continued PBSA shortage and constrained forecast delivery, this renewed welcoming stance towards international students creates a more positive outlook for the 2025/26 academic year where investors could continue to look to the PBSA sector for strong reversions as the demand for beds continues.