Private fixed investment in student dormitories declined 4.4% to a seasonally adjusted annual rate (SAAR) of $3.2 billion in the second quarter of 2021, according to the data released by Bureau of Economic Analysis. Private fixed investment in dorms was 12.7% higher than a year ago, but 29% below the pre-pandemic level.
Private fixed investment in student housing experienced a surge after the Great Recession, as college enrollment increased from 17.2 million in 2006 to reach 20.4 million in 2011. However, during the pandemic, private fixed investment in student housing declined drastically from $4.51 billion (SAAR) in the last quarter of 2019 to a lower annual pace of $2.86 billion in the second quarter of 2021, as COVID-19 interrupted normal in-person on campus learning modes. College enrollment fell by 3.6% in the fall of 2020 and by 3.1% in the fall of 2021, according to the National Student Clearinghouse Research Center.
Student housing private investment is on the road to a limited recovery, as the economy reopens. Pent-up demand for in-person learning has encouraged students to return to campuses, boosting the student housing sector. However, the strength of this recovery remains uncertain.