College Towns Finally Built More Student Housing—Now, Some Have Too Much

The student housing shortage may finally be breaking in some college towns—only for falling rents and empty beds to expose an entirely different problem in its place.Developers delivered more than 31,000 dedicated off-campus bedrooms in 2026 across the university markets tracked by Yardi Matrix, a commercial real estate intelligence platform—20% more than the year before.But some of the newest properties are already struggling to find residents. Buildings delivered this year averaged just 84.1% occupancy in September, according to Yardi’s preliminary estimate, compared with 95.3% for the previous year’s new projects at the same point.It’s a rapid reversal, as many of the markets now showing signs of softness were considered badly undersupplied five years ago.Where college towns went from too few beds to too manyIn 2021, the student housing shortfall was estimated at nearly 756,000 beds across just the 50 most undersupplied schools, according to a model from Berkadia and RealPage. As a flood of pent-up demand from the COVID-19 pandemic rushed back to campus, vacancy at conventional apartments competing for students near campus had also fallen to just 3% that summer.The shortage was ...