Canterbury University’s halls are bursting at the seams, with demand for student accommodation spilling over into an already stretched private rental market.
Agents have told OneRoof that rising university enrolments have put pressure on the housing market and they worry that some students will find it difficult to secure accommodation.
Every one of the 2800 places in the University of Canterbury’s affiliated halls is expected to be taken next year and, based on current applications, there could be another 1297 students who will miss out and be forced to find somewhere else to live.
A University of Canterbury spokesperson told OneRoof it could be “an uncertain time” for students and encouraged those on the waitlist to explore other options, including flatting or private boarding.
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The university increased its accommodation offering in 2021 by 506 rooms with the opening of a new hall of residence, Tupuānuku, and is set to add another 280 rooms in 2026 with another hall, Tupuārangi.
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The rise in the number of students needing accommodation reflects the 5% annual rise in the university student population. Enrolments hit 22,205 at the beginning of 2024 and are currently at 25,000.
While it was too early to tell what the exact numbers would be next year as applications to enrol were still open, the spokesperson said it was “encouraging”.
Harcourts Holmwood Property Management general manager Caroline Register said the agency had been inundated by student applications for rental properties.
According to her property managers, the situation was “manic”. They had received: 48 applications to rent a six-bedroom, three-bathroom property on Montana Avenue, in Ilam; 30 applications for a house on Waimairi Road, in Ilam; and 24 for a rental on Acacia Avenue, in Upper Riccarton.
A six-bedroom, six-bathroom student rental on Waimairi Road, in Ilam, Christchurch, sold under the hammer to an investor for $1.725m after an intense auction fight. Photo / Supplied
All the applications they received were wonderful and it was “heart-wrenching” having to turn people down because they didn’t have enough stock, she said, adding that many of the students had written almost a “special story about themselves”.
“It’s just a real shame. The market needs more stock,” she told OneRoof, highlighting that the agency had less than 100 student rentals on its books. “It would just be great to see some more investors enter the market in those areas.”
Properties with five to six bedrooms, in suburbs around the university, were popular, she said. “Grab the university and put a big ring around it, there’s your idea of areas.”
Bayleys investment sales specialist Angela Webb said investors and parents whose children were planning to attend the university were cottoning onto the fact that there was a shortage in student accommodation.
“At the moment I don’t believe there’s been enough student accommodation provided so the rents have been pushed up, and because the rent has gone up the value of the property increases. You’ve got parents competing against investors, which is driving prices up in the auction rooms.”
Just last week a six-bedroom, six-bathroom property on Waimairi Road, in Ilam, sold at auction for $1.725 million, exceeding expectations. Two investors fought over the property, which had a rental return of $1450 per week and a gross return of 4.37%.
Bayleys salesperson Angela Webb says there isn’t enough student accommodation in the city so rents have gone up and, as a result, so have property values. Photo / Supplied
A property on Paeroa Street, in Riccarton, was bought for $630,000 in 2021 and sold three years later for $777,500. Photo / Supplied
Webb told OneRoof she had sold 30 student rental properties in the last three and half years. She sold one on Paeroa Street, in Riccarton, for $630,000 in July 2021 and again three years later for $777,500. During that time, the weekly rent for the property had risen from $645 to $925.
Student accommodation often outperformed other housing stock in the ring around the university. “In my career, this is probably the biggest demand there has been for the rent increases and the sales values.”
Ray White Metro sales manager Richard Withy said student accommodation was snapped up pretty quickly every year, noting that demand was significantly outweighing supply.
”They get taken each year pretty quickly and the ones that get left out are the ones with a few more bumps and bruises or a few more intricacies about them.”
Withy said the no-cause termination rule introduced by the previous Government had impacted how student rentals were traditionally advertised. Previously, rentals were listed in July and August for availability in December.
But tenants were now able to automatically convert their fixed tenancy agreement to a periodic tenancy and extend it for as long as they liked.
The landlord could only terminate the tenancy if they were moving back in, the rent was in arrears or the property was being sold, which also meant that if the tenant chose to stay on the property, it would be taken out of the university rental cycle.
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