Student housing rents leaped 7% year-over-year in March, reaching a record high of $829 per bed.

Pre-leasing for the next academic year is setting records as well, according to a new report from Yardi Matrix. As of March, 69.7% of beds at 200 universities surveyed by Yardi were pre-leased for the fall term, up 7.8% over a year ago in the sector's best performance of any March.

Despite solid student housing fundamentals, new development isn't growing as robustly, according to the report. Development is being held back by the usual suspects in the current real estate climate: higher interest rates, less debt-market liquidity and skittish investors.

At the start of Q2, about 70,000 student housing bedrooms were under construction, an increase of 20,000 beds over last quarter. But the number of beds in pre-construction phases hasn't budged quarter-to-quarter, leading report authors to posit that there may not be as many beds developed in the near future.

Still, the pressure is on in many places to develop more student housing.

“Universities are under extraordinary pressure, and for them to survive, they’re going to have to leverage their real estate assets to actually accomplish that,” Laura Pisinski, vice president of university real estate and facilities management at Simmons University, said late last year during Bisnow’s Boston Higher Education & Student Housing Real Estate Summit.

For universities in urban areas, particularly in supply-constrained markets, students are competing with a bigger pool of renters, which is one factor driving rents up, according to the report.

But dedicated off-campus student housing tends to follow the similar (though delayed) pattern of conventional multifamily, Yardi reports.

Nationally, market-rate multifamily rent growth peaked in February 2022 and has decelerated since, while student housing rent growth remained steady. If the comparison to multifamily holds, however, rent growth for the student sector may soon slow or even reverse.