Australia’s pipeline of purpose-built student accommodation (PBSA) has jumped to 40,000 new beds, as the sector responds to federal government policy linking universities’ international student visa allocations to genuine growth in student housing.
The latest Urbis Student Accommodation Benchmarks, produced with the Student Accommodation Council, confirm that the government’s approach is shifting the market. The number of privately owned and managed PBSA beds has now surpassed 90,000, with a national total of 134,000 student-only beds when on-campus and college accommodation is included.
This year, public universities were required to demonstrate progress on student housing if they wished to expand international enrolments — a link that has clearly catalysed new development activity across the country.
The growth has been significant. The development pipeline has climbed from 36,000 at the start of the year to 40,000, reflecting rising investor interest and strong partnerships between universities and PBSA operators.
According to Urbis, 12,522 beds are currently moving through the development application phase, 16,366 have secured development approval and 11,202 are already under construction. Urbis Director Clinton Ostwald says that momentum will continue.
“In Q3 alone, we saw 3,000 approvals, including 2,600 in Inner Adelaide,” he noted. “Perth has also experienced a surge in new applications, while Melbourne holds a significant number of projects in the approval stage. We’re projecting around 7,500 completions in 2027.”
State-by-state, the picture is mixed. New South Wales leads with 9,876 beds in the pipeline, followed closely by Victoria with 9,170, while Queensland has 8,839, Western Australia 6,500, and South Australia 4,216 — boosted by a bumper quarter in Adelaide.
Despite its sizeable pipeline, Victoria is facing increasing scrutiny over its ability to deliver projects. The bulk of Victorian beds, more than 7,200, remain stuck in the approval or application stage, with industry leaders warning that state taxes are undermining project feasibility.
The issue is particularly acute because PBSA is predominantly funded by international capital. Under Victoria’s foreign investor land tax surcharge, student accommodation providers face a tax burden that is dramatically higher than in other states.
In Melbourne, each student bed incurs $2,795 in combined council rates and state land taxes every year 126 per cent more than in other Australian jurisdictions. By contrast, annual taxes per bed are $1,480 in Sydney, $1,145 in Brisbane and $1,081 in Adelaide.
The Property Council argues this tax regime is working directly against national housing goals.
Property Council Executive Director Torie Brown says the data illustrates a broader issue: while federal policy is successfully spurring new investment, Victoria risks slowing the sector down.
“The federal government has made clear it wants to see continued growth in student accommodation, and these latest figures show the approach is working,” she said. “But Victoria is taxing students out of beds. It’s hard to justify the ‘Education State’ label when the state is punishing providers who support our higher education system.”
A Mandala Partners analysis backs these concerns. Since the foreign owner surcharge was doubled in 2023, institutional capital flowing into Victorian commercial and large-scale residential projects has fallen 53 per cent, and the state now attracts 40 per cent less global investment per capita than NSW.
Brown warns that these settings risk pushing investors elsewhere. “A sustainable international education sector depends on matching student growth with serious accommodation supply. The cities that make it easier to invest will reap the benefits — and we’re already seeing that in places like Perth and Adelaide.”
What remains uncertain is whether all states, especially Victoria, will calibrate their tax and planning systems to fully support the national push.
With demand for student housing showing no signs of slowing, the next few years will determine which cities attract the investment needed to build the student hubs of the future.
