In recent years, the number of foreign students at Prague universities has been growing, and with it the demand for accommodation. In the past, the number of university students declined by an average of 3% each year. This downward trend has now reversed, and in the 2020/2021 academic year, 117,059 students enrolled at Prague universities. Currently, we have approximately 25,000 foreign and 46,000 Czech students, a total of 71,000, who need a bed. The Student Housing Market offers only over 28,400 beds, with 9% of this capacity provided by the private sector (PBSA).

According to a survey by Savills, Prague-based private PBSA operators rent their spaces mainly to foreign students, who make up 80% of all full-time students. Prague universities are continuously investing in the renovation and reconstruction of their dormitories. However, even after the completion of these modernization works, the standard of accommodation will not be comparable to privately owned accommodation, which is most sought after by international students.

Although the number of high-quality student residences is gradually increasing, with a total of 14 recorded in March 2021 and bed capacity increased to 2,600, there is still a shortage of 33,000 beds on the market. Several new student residences are planned to be built across the city in the near future, but it is unlikely that they will expand significantly by 2023.

This opens up great business opportunities for the real estate market segment, developers, and investors. In the European context, the Czech Republic is one of the emerging PBSA markets. The RCA agency estimates that, based on the low availability of existing student accommodation assets on the market and growing investor interest and residential yields, primary yields for high-quality residences in Prague will grow to around 4.25%.