The term “Student Housing in Spain” is increasingly used to encompass the broad range of investment opportunities available within this sector, which remains resilient even as globalisation poses challenges. Overall, it represents a lucrative business opportunity, offering promising returns whether investors choose to focus on student residences or built-to-rent properties. Spain’s student population is substantial, with 91 universities (50 public and 41 private) and a total of 1.76 million students enrolled in the 2023-2024 academic year. According to the Datos y Cifras del Sistema Universitario Español report by the Ministry of Science, Innovation and Universities, 11% of students are international, with 7% in undergraduate courses, 27% in master’s programmes, and another 29% enrolled in doctoral studies. This growth is positioning Spain alongside higher-GDP countries like Germany and France, where international student proportions were 12% and 10.6% in 2022, respectively, as well as the UK, where the figure reached 20.9% in 2019. This is occurring alongside a shortage of purpose-built student accommodation, which presents a clear opportunity for investors.
So, what do students seek? Comfort, affordability, and social life. According to Aluni.net, a property firm specialising in shared student flats, students favour well-located, affordable accommodation with spaces that encourage socialising, along with essential services such as fully furnished rooms and internet access. Given these preferences, it is important to note that rising rental prices, with increases of 10.2% in cities like Madrid and Barcelona, according to the 2024 Rental Observatory, have created greater demand for flexible housing solutions. In this context, seasonal rentals have gained traction, particularly among international students and Masters students, who seek contracts that accommodate their academic mobility without long-term commitments.
Building on the traditional shared flat model, now evolved into a premium version, Co-living is also emerging as an alternative that combines private zones with shared common areas and services. This evolving model represents an opportunity for investors interested in assets designed to maximise occupancy and adapt to new student housing trends.
Investment in Student Residences
The Student Housing sector in Spain is attracting increasing capital, establishing itself as one of the most dynamic sectors within real estate. According to Savills, 2022 saw a record €1.246 billion invested in student housing, nearly tripling the previous year’s total. This momentum continued into 2024, with €756 million invested by December, reflecting investor confidence in the market’s potential.
This sustained interest is driven by the increasing appeal of the European student housing market, where Spain is positioning itself as one of the most attractive destinations. According to a report by JLL, the sector is set to keep expanding, with an active pipeline of new student residences being developed in secondary cities with high university demand.
The attraction to this sector is no coincidence. The combination of consistent demand and an evolving market has firmly established Student Housing in Spain as a strategic asset. Its ability to generate stable returns, coupled with a supply that still needs to grow to accommodate the expanding student population, positions it as a secure investment for those seeking long-term value.
Key Markets
Madrid and Barcelona remain the leading educational centres in Spain, home to 23% and 13% of the nation’s on-campus students, respectively. However, cities like Valencia, Seville, and Granada are emerging as increasingly attractive markets for developing student residences, driven by their growing student populations and limited specialised accommodation options. According to Savills, the average yield for student residences in Spain ranges from 5% to 6%, with occupancy rates consistently exceeding 90% in major cities. This has prompted interest from new investors and developers looking to expand beyond Madrid and Barcelona.
In this context, investors and developers are finding an ideal opportunity to diversify their portfolios and capitalise on a sector with a strong balance of stability and growth potential.
We have already seen how student accommodation has transitioned from being a secondary alternative to becoming a cornerstone in the Spanish property market. Its capacity to meet growing demand and offer attractive investment opportunities positions it as a sector with considerable future potential. The combination of rising demand, limited supply, and increasing investor interest presents an ideal environment for the development and expansion of real estate innovation around this sector. Appearing in searches for Student Housing in Spain is becoming essential for any real estate investor looking to build a stable and diversified portfolio.
