Expect short-term pain, but long-term gain. this has been a rotten year for students and their landlords. the pandemic has confined many youngsters to their digs. more have cancelled rent agreements than usual, quoted provider unite group said on thursday. but the disruption is unlikely to do lasting damage to investment prospects, or student chances of getting a financial return from their degree.

The number of places accepted by students at uk universities is 4 per cent higher than last year. but acceptance does not mean attendance. some postgraduate courses favoured by international students have yet to start. a third or more may defer. unite has pencilled in a 10-20 per cent fall in rental income this academic year.

Unite has been forced to offer discounts in places where supply exceeds demand for accommodation. but it has much less international student exposure than rivals esp and gcp, says jefferies. though unites share price has fallen 30 per cent this year, unlike peers it trades at a premium to net asset value. that also reflects a 300m share placing in june enabling it to pay down debt. banking covenants are not threatened. occupancy would need to fall to 55 per cent this academic year to breach its strictest.

Landlords fortunes are closely tied to the universities where they operate. the institute for fiscal studies has questioned the long run viability of 13 universities struggling with pension deficits and potential student shortfalls. with the inflation in a-level (entrance examination) grades this year, recruitment at universities with lower entry requirements stagnated. these campuses account for only a tenth of unites estate.

A rising number of 18-year-olds bolsters its investment case. its purpose-built and professionally-run accommodation should capture market share from amateur landlords. that will always matter if some can afford to pay for better housing, especially if that leads to a better student social life.

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