University Housing is a hot topic these days. Students wanting to get a university education, are facing steep costs to fulfill their dream. For universities looking to grow enrollment at their institutions, housing is the top priority to help achieve this goal. With the high cost of tuition for students and the high costs for a university to build student housing, the solution doesn’t seem so clear. Having a better understanding of both pictures can help us look forward to a potential solution to the crisis.
Debt loads are increasing for Post-Secondary students. With an average of over $30,000 of debt, the outcome of graduation can come with a sting. The average salary for a business graduate fresh out of school ranges between $40-50K, so the option of paying off student debt is not within reach right away – let alone 10 years.
Unless you have a scholarship or the funding from family or other sources, debt is almost an unavoidable option. This can be a huge challenge and a deciding factor when students are considering which school to attend. Depending on the costs of tuition and housing, a student may choose to attend a school that is more affordable, which leaves them in a better financial position afterward.
The decision-making process for attending a school has changed quite a bit from when I was a student, as the decision isn’t just based on type, or level of education, but also on affordability. Once a student has been accepted to a particular school, then comes the challenge of finding a place to live if they are moving from a different area.
With a less than 3% vacancy rate in the GVRD, high rent and long wait lists for on-campus housing, students are then forced to accept what is available – sometimes in overpriced and crowded conditions. Offering housing on campus that is affordable can ease the burden for future students, and make their decision on which school to attend that much easier.
There is an additional element that makes matters more complicated. The quality of the university experience an institution offers is not solely based on education, but also on the events, practical knowledge and daily life interactions that occur during the student’s life on campus. I met some long-time friends when I was at school and that came through developing relationships when I was ON CAMPUS. Being on campus allowed me to have access to new friendships, a social atmosphere, educational resources, and most of all, a memorable experience. On top of that, university housing allows the student to focus on why they came to school, to learn, achieve, and in turn, lead our society into the next generation. Affordable housing has all to do with creating this atmosphere, and so the question is, why aren’t universities building more housing on-campus to alleviate the pressure?
The Lower Mainland has some of the best institutions in Canada, so no wonder the demand for enrollment is increasing, fast. Not only are local students attending these schools, but international enrollment is rising very quickly. As the race is heating up, universities are looking at creating options for students to live on-campus, as having access to housing will not only attract students coming to their school for their academic programs, but also for the full range of services the school can offer.
I recently read a report of a local institution looking to create housing options because they were losing their students to other institutions as there were no affordable places to live near campus. Since the university didn’t have on-campus housing to offer, students had to look for market units. Well, that didn’t turn out well because the average rent in this area for a one bedroom apartment was just under $2,000 per month.
The story doesn’t end here. For years universities have not been able to access funding, “Loans,” from banks or governments. Regulations didn’t allow to take on debt as this would affect their credit rating. Progressive schools like UBC and SFU had trusts in place to manage these investments, but other schools didn’t have the same programs in place. As well, UBC and SFU have land available they can use to develop housing or other types of business that could help the school create a revenue stream to help fund capital projects.
The case is different for other schools, they don’t have the land to develop, or to create business opportunities. They rely solely on revenues generated from their programs, and their private donors. These schools haven’t had the opportunity to apply for loans to build housing and grow their institutions, until now.
Recently the government committed about $300 Million to University Housing over the next couple years, so the money can be accessed to develop that housing. However, this comes at a cost as this is not a grant, but a loan. Each school must have in place a strong business case to take on a loan and to have the demand for enrollment that supports that case. This is not an easy task, but steps will need to be put in place by each school to find a solution for the future. No matter what the outcome is for housing, there will be a need, and each school will look closely at their capital plans to develop housing for students. Even though it is not the best solution, it is a way for universities to finally do what they were not able to in the past, and take their institution to the next level. Patience is needed though as the change will not happen overnight.
Even though this solution isn’t perfect, it is offering an alternative for universities and institutions to be able to build more housing capacity. This is a step in the right direction, and little by little, positive changes are taking place and is shaping the way for future students and institutions.
Metric Modular is committed to being part of the solution to the housing crisis in our region, and we are partnering with local universities to help them create housing alternatives with the funding universities and institutions have available. Stay tuned for more details on a key modular student housing project that is currently underway and that will help provide housing for their growing student population.
Manager, Innovative Solutions firstname.lastname@example.org 604-787-5701