Thirty five university towns (55% of the 64 surveyed) in the UK have an average house price higher than in surrounding areas, with an average price premium of £20,335 compared to the county average according to new research from the Halifax.

Of those 35 university towns, nine have an average house price premium in excess of £20,000 when compared to their county. These include Winchester (£114,489, or 50%), Bath (£98,562, or 43%), Cambridge (£90,699, or 44%), Warwick (£75,454, or 46%), Oxford (£39,797, or 14%), Newcastle (£25,005, or 16%) and Stirling (£20,296, or 13%).

Price Growth
Manchester, which has the largest student population in the UK - 73,160 - recorded average house price growth of 63% during the last five years, well above the UK average of 44%. Liverpool, which has a student population of 53,705, saw average prices increase by 71% during the period.

However, some university towns with a smaller student population also experienced large average house price increases. Glasgow, with a student population of 45,125, recorded average price growth of 74% and Preston, with 29,845 students, saw a price rise of 53% during the five years.

Rental incomes
Halifax also found, on average, students paying £96 per week (£415 per month) for private rented accommodation across university towns in the UK.

The highest average rents are paid by university students in London, at £116 per week (£502 per month), followed by the East of England and South West (£104 per week, or £452 per month). The lowest are in Northern Ireland with an average student rent of £64 per week (£276 per month).

Demand for private student accommodation has been driven by the increasing number of students entering higher education in recent years, particularly term time students living away from home and those from overseas who are likely to be there throughout the academic year.

Regarding value for money, Halifax found the most expensive university town to be Guildford in Surrey, (£363,503), followed by Winchester (£343,332), Bath (£326,403), Oxford (£323,946) and Cambridge (£295,581). Outside southern England, the most expensive university towns are Bangor with an average house price of £245,855, Warwick (£240,332) and Cheltenham (£237,868).

In contrast, Hull is the least expensive university town with an average house price of £124,108. The average house price in Hull has increased by 79% during the past five years. Other cost-friendly towns include Stoke-on-Trent (£130,336), Bradford (£131,464) and Salford (£148,338).

Martin Ellis, chief economist at Halifax, commented: “The majority of the university towns we have surveyed have an average house price higher than the average for their county.

“While it can be a good investment, the decision to buy a property for a son or daughter at university ultimately depends on the parents’ personal circumstances and property prices around the university in question.”