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Swift return of Chinese students to add immense pressure to rental market

01 FEB 2023 By Kyle Robbins 4 min read Hotspots

A snap decision by the Chinese government has placed Australia’s desperate need for student accommodation under the spotlight.

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According to the Student Accommodation Council (SAC), a branch of the Property Council of Australia (PCA), the Chinese government’s edict dictating academic degrees and diplomas would no longer be recognised if the studies are undertaken online will place immense pressure on the Australia’s purpose-built student accommodation (PBSA).

The directive, released by the Chinese Service Centre for Scholarly Exchange (CSCSE) earlier this week, outlined how “in order to effectively protect the interests of students who receive overseas education and maintain the fairness for education, our centre will no longer provide certification/accreditation for foreign diplomas and degrees obtained during the spring semester of 2023 (autumn semester of the south hemisphere)”.

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It also implored students to return to their host country “as soon as possible”.

Minister for Education Jason Clare said 35,000 Chinese students returned to Australia in the first month of the year, while information from The Guardian revealed that “42,000 Chinese nationals with student visas remain offshore … including 5,500 applicants processed in the past month and 2,400 in the past fortnight”.

A federal government mandate beginning on 5 January 2023 currently requires “pre-departure testing for COVID-19 for people travelling to Australia from the People’s Republic of China and the special administrative regions of Hong Kong and Macau”.

Torie Brown, executive director of the SAC, said Chinese students (27 per cent) and Australian students (26 per cent) were the two biggest cohorts living in PBSA.

The urgent scramble for returning students will not only fill PBSA but also regular tight rental markets “as students look elsewhere to live”.

“Data released by Savills showed the supply pipeline for purpose-built student accommodation beds is muted for the next two years — with 100 per cent of new beds coming online in 2024 located in Sydney and Melbourne,” Ms Brown said.

Last October, commercial real estate giant JLL published its “Australian PBSA investment update 2022”, which found the country boasted just 112,000 student housing beds.

For this reason, she believes every level of government must prioritise “the development of new student accommodation because it provides appropriate housing exclusively for students and stops them competing with mums and dads in the rental market”.

These outcomes could be facilitated through “expedited planning approvals, removing taxes like foreign investor fees and planning systems that prioritise student accommodation close to places of study should all be a top priority for policymakers”.

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