More than two-thirds of all university towns recorded house price increases in excess of the UK average.
Many new universities were formed when polytechnics converted to university status after 1992. The change in status enabled them to award their own degrees and thereby attract more students.
House prices have more than doubled in seven of these new university towns over the last decade. Bangor in Wales recorded the biggest increase (129%), followed by Carlisle (110%), Sunderland (108%) and Dundee (107%). Pontypridd – home to University of Glamorgan – (106%), Bradford (105%) and Plymouth (102%) were the others where prices more than doubled.
The most expensive new university town – and also the most expensive of all university towns – is Winchester with an average house price of £364,667, followed by Kingston-upon-Thames (£360,331) and Buckingham (£330,795). The least expensive are Salford (£106,685), Paisley (£106,967) and Bradford (£108,282).
Despite the success of the newer establishments, older university towns have also recorded significant house price growth. In Aberystwyth the average house price has increased by 144%, making it the top performer of any university town. Hull saw the next biggest rise amongst older university towns – and the third amongst all universities – with the average price increasing by 119%, followed by the historic Scottish university cities of Aberdeen (118%) and Edinburgh (103%), and Exeter (91%).
The ancient university town of Cambridge has the most expensive homes amongst old university towns outside London, with an average price of £291,079. Oxford (£258,531) and Reading (£248,076) have the next highest average prices. Hull is the least expensive old university town – and the second least expensive of all university towns – with an average price of £106,021.
Eleven of the university towns in the Times Top 20 University Rankings have seen average house prices rise by at least 75% over the past ten years. Edinburgh (103%) and Exeter (91%), were followed by Loughborough (90%), Leicester and Cambridge (both 88%) and Lancaster (84%). The average increase for all 20 towns (excluding London) was 73% meaning that these top ranked universities outperformed university towns as a whole.
Nitesh Patel, housing economist at Lloyds TSB, commented:
"Growing student numbers are likely to have had a positive impact on house prices in university towns over the past decade. This effect has been heightened in the newer university towns where prices have, on average, risen more rapidly than in the towns that host the more established universities. Increased student demand for accommodation is also likely to have added to upward pressures on rental values in university towns, increasing their attractiveness to landlords.”
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