07/10/2026
NSFAS Student Accommodation: Location is becoming just as important as compliance
If you are considering investing in a property for NSFAS-funded student accommodation, there is another question you should be asking before you buy, lease, convert or refurbish a building:Is there actually demand for additional accredited beds in that area? A recent NSFAS Notice provides an important lesson for both prospective and existing accommodation providers.
Following an assessment of accommodation capacity and demand, NSFAS has found that Joburg and the Vaal currently have sufficient accredited accommodation capacity relative to demand. NSFAS has therefore temporarily suspended the normal processing of new accreditation applications in these areas. Perhaps even more significant is the principle behind the decision. NSFAS says it will adopt a demand-led approach to new accreditation in areas where sufficient accredited capacity already exists. In Joburg and the Vaal, prospective providers can express interest, but NSFAS will assess the property against prevailing student demand and existing accredited capacity before deciding whether to proceed with accreditation. What does this mean for would-be student accommodation investors? Location selection cannot be based only on proximity to a university or TVET college. Before committing significant capital, understand the student population, existing accredited bed capacity, potential unmet demand and the institutions your property is intended to serve.A property can meet the physical accreditation standards and still be situated in an area where additional beds are simply not required at that time. In fact, NSFAS specifically cautions prospective providers in Joburg and the Vaal against making significant expenditure or financial commitments based on an expectation of accreditation during the temporary closure. And what about existing Johannesburg and Vaal accommodation providers? Importantly, the circular specifically refers to the temporary closure of the accreditation process for new accommodation providers. If you are already accredited, read your existing agreement carefully. Check the accreditation period, expiry date, renewal or re-accreditation provisions and any requirements relating to inspections. Do not automatically assume that the temporary closure either applies — or does not apply — to your particular contractual position. Where necessary, seek clarification from NSFAS.
The bigger lesson?📍 Location matters.📊 Demand matters.🏠 Compliance still matters.
A good student accommodation investment needs all three.
Dez Sikakane Teboho Seretlo