Student Housing Boss Says Students Are Ditching Luxury for Practicality

Turns out, hot tubs and golf simulators aren’t the ticket to filling beds anymore.

Student housing rent growth has basically stalled, rising just 0.9% in July across 200 colleges, according to new Yardi data. Average advertised rent even slipped to $905 per bed, as operators scramble to fill space.

Robert Bronstein, CEO of Scion, one of the nation’s biggest student housing owners, says both ends of the market are shifting.

“At the lower end, students are heading back to old-school rental houses off campus,” he told CNBC. “And at the higher end, students are realizing: ‘Why pay 30% more for a rooftop hot tub I’ll never use when I can live in a three-year-old building for less?'”

The new must-haves? Co-working areas and Zoom rooms for interviews. The once-hyped perks — think movie theaters and game rooms — aren’t driving leases anymore. Affordability is.

Scion, which manages nearly 95,000 beds across 83 schools, is leaning into big, flagship universities where enrollment keeps breaking records. Places like Gainesville, Ann Arbor, and Madison can’t build fast enough to house everyone.

“Schools with 40,000 to 60,000 students are overflowing,” Bronstein said. “That’s where the action is.”

High interest rates and rising construction costs have slowed new development. That makes existing properties more valuable — good news for Scion, which is scooping up assets at large schools.

A fresh outlook from Walker & Dunlop agrees: the market is stabilizing as rates cool, institutional money flows back in, and enrollment keeps climbing. The big trend? Less bling, more basics.

As Bronstein puts it:

“The era of luxury for luxury’s sake is over.”

The original story by Diana Olick for CNBC.