The U.S. student housing sector continued to show strong resilience and steady performance through the third quarter of 2025. Despite broader capital-markets volatility, investment activity in student housing grew 8% year-over-year, reaching $6.8 billion in total transaction volume through 3Q25. This stability is driven by high occupancy levels, healthy rent fundamentals, and limited new supply across top university markets.
Cap rates continued to tighten, compressing 48 basis points year-over-year to an average of 5.62%, reflecting strong investor confidence and durable pricing even in a selective environment. Although quarterly volume in 3Q25 declined relative to last year, valuations remained stable with only a modest change in pricing per unit.
Institutional capital remained the dominant buyer group, and student housing continued to outperform traditional multifamily in cap-rate compression, liquidity, and demand fundamentals. With national occupancy levels above 95% and pre-leasing momentum at record highs, the sector is positioned for continued strength into 2026.
Key Highlights
- $6.8B in YTD transaction volume, up 8% from the same period in 2024.
- Cap rates compressed to 5.62%, signaling resilient pricing amid macroeconomic uncertainty.
- Stable valuations, with average per-unit pricing holding at ~$246,500.
- Institutional buyers remained most active, representing ~60% of 3Q25 activity.
- Student housing maintained a strong position relative to multifamily, with similar YOY volume growth but stronger cap-rate movement.
For readers who would like deeper data and analysis, the complete Newmark 3Q25 Student Housing Capital Markets Report can be requested here.
