By Letara Draghia
Copyright euroweeklynews
Spain has become a hotspot for global investors targeting its under-supplied student housing market, as international admissions soar.
A 77 per cent rise in foreign students over the past decade has fuelled record investment, with Canadian and US firms leading acquisitions in Madrid and Barcelona.
Overseas student registration drives student housing boom in Spain
According to Reuters, international student numbers in Spain have climbed by 77 per cent in ten years, creating unprecedented demand for purpose-built accommodation. Yet, only 117,000 student beds are available nationwide, covering less than a fifth of the estimated 622,000 students seeking housing, according to agency JLL data cited by Reuters.
This shortage has spurred high-profile deals, including Nido Living’s €1.2 billion purchase of Livensa Living, funded by Canada’s CPP Investments. Major US developers such as Greystar and Hines are also expanding rapidly in Spain.
Why investors are targeting student housing in Spain
Prime yields on student flats in Madrid and Barcelona stand at 4.5 per cent, higher than 10-year Spanish government bonds at 3.3 per cent, according to CBRE data cited by Reuters.
Demand is fuelled by lower tuition fees and less restrictive migration policies than in the UK or US, making Spain more attractive for overseas students.
Around 90 per cent of students at Spain’s leading business schools, such as IE and IESE, come from abroad.
Nigel Allsopp of Greystar called Spain “the most landlord-friendly market in Europe,” citing the low ratio of beds to students.
Rising costs leave Spaniards struggling
While premium blocks attract wealthy overseas students, many Spanish students cannot compete. Rents in new complexes often exceed €1,000 per month, compared with the approximate €400–500 budget of local students.
The lack of regulation in the industry allows landlords to raise prices more easily than in Spain’s wider rental market. Meanwhile, a broader housing deficit of 400,000 homes has been worsened by a 25 per cent rise in tourist rentals over the past two years, according to the Bank of Spain.
For expat students, Spain offers modern, well-equipped housing in major cities, often with amenities such as gyms, pools, and study spaces. However, rents are climbing quickly, particularly in Madrid, Barcelona, and Valencia, where demand outstrips supply.
Developers like Stoneshield Capital plan to double their portfolios, with Hines set to add 1,700 new beds across Iberia. With record levels of overseas enrollment and sustained investor interest, Spain’s student housing market is expected to expand significantly through 2026.
Expats moving to Spain with families should be aware that rising international enrollment and investor-led housing development could make student accommodation scarce and costly in the coming years.
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