Students boost property market
In our most recent piece of research, British living, we compare the housing market across 29 of Britain’s most well-known towns and cities and were struck by one of the not-so-obvious ones: universities.
Now, it makes sense that a university town would experience a steady stream of students and therefore sport a robust rental market, but what we didn’t expect to find was such a strong correlation between university towns and house price growth.
Take Oxford, for example. This leafy and affluent city is not only home to one of the world’s most famous universities, it also experienced 16% average house price growth over the last year in comparison with London’s 12%, bringing average values up to £431,143. That is only 6% lower than average prices in the capital. And with 22 schemes granted planning permissions over the last two years, 18% average rental growth over the past year alone and a healthy 28% proportion of private renters, Oxford would be a great candidate for build-to-rent schemes in the future.
In the same vein, Cambridge consists of 35% students, many of whom stay in the area after their studies and has healthy average house prices of £380,817 following 9% growth last year. Edinburgh, another historic and beautiful university town, experienced a whopping 21% average house price growth over the last year taking prices to £260,637, together with 19% rental growth.
In fact, this trend can be seen extending across big university towns as a whole: Bath (£368,108) has average prices 43% higher than the South West as a whole (£257,896) and healthy rental growth of 8% over the last year in comparison with the region’s average of 4%. And just a 15 minute train journey away, Bristol’s university has seen the city’s renter population grow to 24%, a fact bound to translate to build-to-rent schemes popping up in the near future.
Exeter, on the other hand, is currently home to over 20,000 students, many of which are from an international origin. During recent years the area has proven resilient, performing significantly better than other regions across the country. With 21% of the population renting privately and an annual average house price growth of 16% last year, Exeter is set to further benefit from a £70 million regeneration of the town centre which is currently underway.
So it turns out students do more than ensure a place has a thriving nightlife with cost-effective drinks – they ensure the housing market thrives. Go figure…