In Depth: How the U.S.’ Foreign Student Loss Could Be Hong Kong’s Gain
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Liu Yang got admitted to University of California, San Diego, but never got the chance to go.
During his visa interview, immigration officers scrutinized his social media posts, some of which touched on sensitive issues. In the end, the 18-year-old’s student visa was denied this past June. The denial left Liu scrambling, and he turned to applying to schools in Hong Kong.
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- Stricter student visa and work policies in the US, UK, and Australia have led to a rise in overseas applications to Hong Kong universities; nonlocal student enrollment grew from 52,800 (2021-22) to 89,000 (2024-25), now comprising about 30% of all tertiary students in Hong Kong.
- The influx boosts university revenue—self-financed nonlocal students contributed HK$10.6 billion tuition in 2023-24—and intensifies demand for student housing, with severe dormitory shortfalls and rising rents.
- Most nonlocal students are from mainland China; universities face resource strains and warnings against over-commercialization, with calls to balance expansion with quality and global diversity.
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[para. 16][para. 17][para. 18] Overseas undergraduate applications to major universities have surged — CUHK saw a 50% increase for 2025-26, with HKU and HKUST also reporting record highs. [para. 19] Beyond academia, the government is keen to boost the education sector for economic reasons: funding for public universities is being cut by 2% annually, and they must return HK$4 billion to the government. Tuition and fees made up 30% of university revenue in 2023-24, totaling HK$16.75 billion, with self-financed nonlocal students contributing HK$10.6 billion (a 17% increase).
[para. 21][para. 22][para. 23][para. 24][para. 25] The influx of students elevates demand for real estate, especially rentals near universities where rents have soared. For instance, a master’s student prepaid nearly HK$200,000 for an apartment, and the average rent near HKU is around HK$13,000 per month. However, there is a severe shortage of student housing: Hong Kong had only 48,100 dormitory beds for 92,000 nonlocal students in 2024-25, a shortfall projected to reach 120,000 beds by 2028, creating new opportunities for investors and universities to acquire real estate.
[para. 27][para. 28][para. 29] While the economic benefits are clear, there is strain on resources: student competition for courses is fierce, infrastructure is stretched, and laboratory space is limited. Despite increased diversity, most nonlocal students are from mainland China. Some experts argue that, while Hong Kong can become an Asian education hub, building a truly global hub is more challenging due to structural constraints.
[para. 31][para. 32][para. 33] Efforts to globalize include opening overseas offices and campuses. However, some warn against over-commercialization, citing the risks of becoming a "degree factory" with compromised standards, as seen in Australia. [para. 35] Ultimately, while Hong Kong is absorbing more international students, ensuring balanced development and maintaining quality remain ongoing challenges.
- AcadeMe Education
- AcadeMe Education is a college admissions consultancy led by Yang Gang. Since 2024, their clients applying to U.S. undergraduate programs also apply to universities in Hong Kong or Singapore as backup options, as parents seek to mitigate risks associated with U.S. policy changes.
- EIC Education Overseas Education Division
- Li Yang, the Asia regional director for EIC Education Overseas Education Division, notes that students and parents are more cautious when choosing study abroad destinations. He highlights Hong Kong's advantage of offering shorter and more affordable non-research master's programs compared to those in the U.K. and Australia.
- Centaline Investment
- Centaline Investment acquired and renovated a hotel for approximately HK$200 million. This renovated property was subsequently rented out for student housing, with 98% of the beds pre-rented. This venture yielded an expected return above 6%, significantly higher than the building's previous earnings as a hotel, demonstrating the financial viability of converting properties for student accommodation.
- Colliers
- Colliers, a real estate firm, noted that Hong Kong universities provided 48,100 dormitory beds for 92,000 nonlocal students in the 2024-25 school year. Colliers projects this shortfall will reach 120,000 beds by 2028, identifying it as an investment opportunity.
- Cushman & Wakefield
- Tom Ko, an executive director at Cushman & Wakefield (世邦魏理仕), noted that the demand from non-local students has revitalized Hong Kong's real estate market. This demand has spurred activity in a market that historically lacked specialized student housing options.
- 2021-22 school year：
- Nonlocal student enrollment in Hong Kong universities was 52,800.
- 2023-24 school year：
- Hong Kong's eight public universities' tuition and fees income rose to HK$16.75 billion, with self-financed nonlocal students contributing HK$10.6 billion, a 17% increase.
- 2024：
- Hong Kong universities held HK$117 billion in cash and financial assets, compared to total office and retail property transaction value of HK$28 billion.
- Since 2024：
- Most clients of AcadeMe Education applying to U.S. undergrad programs also started applying to Hong Kong or Singapore as a backup.
- 2024-2025：
- HKUST Business School purchased an office floor for HK$354 million, City University of Hong Kong bought a commercial plaza for HK$880 million, and Hong Kong Metropolitan University acquired a commercial tower for HK$2.6 billion.
- 2024-25 school year：
- Nonlocal student enrollment in Hong Kong universities rose to 89,000.
- 2024-25 school year：
- HKU admitted 1,200 new nonlocal undergraduates, hitting the government ceiling.
- May 2025：
- An incoming master's student at Hong Kong Polytechnic University paid nearly HK$200,000 for a full year's rent.
- June 2025：
- Liu Yang's student visa to the U.S. was denied.
- Summer 2025：
- Intense competition for rentals near Hong Kong's universities occurred.
- July 2025：
- The government launched a scheme to encourage the conversion of properties like hotels and offices into student residences.
- 2025：
- The Hong Kong government proposed a 2% annual reduction in recurrent funding for public universities for 2025-2027 and required HK$4 billion to be returned from reserve funds.
- 2025：
- The average monthly rent for a 20-square-meter apartment near HKU reached about HK$13,000.
- September 2025：
- The Hong Kong government released its 2025 Policy Address, pledging to turn the city into an 'international education hub' and lifting the cap on nonlocal student admissions.
- September 2025：
- The start of the 2025-26 academic year; campuses observed to be more crowded by students.
- September 2025：
- The 2025 Policy Address announced raising the cap on self-financed nonlocal students at public undergraduate institutions from 40% to 50% of the local ceiling.
- September 2025：
- A Colliers report found Hong Kong universities had 48,100 dormitory beds for 92,000 nonlocal students in the 2024-25 school year.
- For the 2025-26 school year：
- CUHK received 50% more applications from overseas undergraduates compared to the previous academic year.
- 2025 or 2026：
- HKU Business School’s building in Barcelona, Spain, is expected to become its first European campus.
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