Unite Group has lowered its profit outlook again after weaker student demand led it to reduce rents in some cities and sell parts of its portfolio.

The company, which describes itself as the UK’s biggest student housing provider, has reported slower reservations for the 2026-27 academic year, with only 74% of its 72,000 student beds taken. The result is below the 76% recorded at the same stage last year and short of the 80% or more the company would previously have expected by mid-April.

The pressure has been linked to a fall in overseas student numbers following visa changes, alongside more domestic students choosing to live at home.

Unite’s chief operating officer, Karan Khanna, said the “most challenging” cities were Nottingham, Leicester and Sheffield. In those areas, the group has reduced rents and shortened tenancy lengths from 51 weeks to 44 weeks. Similar changes have also been made in other places, including Bristol and Burnet Court in Edinburgh, where student rooms start from £250 a week.

Occupancy for the next academic year is expected to be towards the lower end of Unite’s 93%-96% guidance range, with rental growth also forecast at the lower end of 2%-3%. In recent years, the company’s halls had regularly run at more than 97% occupancy.

Shift towards leading universities

Unite has said it will focus more closely on owning and managing accommodation in cities with “high tariff universities”, meaning institutions requiring the highest A-level grades and UCAS points for entry.

Chief executive Joe Lister said: “We should be focusing on those high tariff universities; we have seen changes in the marketplace coming from the move to more students staying at home and the fall in international postgraduates, and repositioning the portfolio will take some time.”

He also said: “We have already increased our disposal programme, and the board is exploring options to further accelerate our transition to a more focused, higher-quality portfolio.”

The company has already sold £130 million of assets and has earmarked £500 million of assets for sale over the coming year. Some of the proceeds are expected to help fund a £100 million share buyback, of which £85 million has already been spent.

Concerns raised

The Times newspaper reports thatanalysts have raised concerns about the scale of the task ahead. One said: “Unite needs a strong summer of reservations”, while another warned that “The work ahead remains significant”.

The Guardian newspaper also reported that Peel Hunt analyst Matthew Saperia as predicting  “The job of returning Unite to growth remains considerable, and execution risk remains high.”