Rising rental costs near universities add to financial pressures as maintenance and tuition fees increase for students in 2025.
With the start of the 2025/26 academic year just around the corner, university students in England are set to face the first increase in maintenance and tuition fees in nearly a decade.
However, new research sent to The London Property News from Zero Deposit, a tenancy deposit alternative provider, reveals that the looming fee hike may not be the most pressing financial concern for students.
The study highlights a significant issue: students are being forced to pay premium rent prices to live close to their universities, with some paying as much as 88% more than the average rental costs in nearby areas.
The cost of living in the campus proximity
Zero Deposit analysed the average rent prices for homes located in the outcode areas of the top 100 universities in the UK and compared them to the average rent prices within their respective Local Authority (LA) districts.
The results show a clear trend: students are paying considerably more to live close to their university campuses.
Across the 100 leading UK universities, the average rent for homes in the outcode areas is £1,509 per month, which represents a 12.4% premium over the average rent of £1,293 in the surrounding Local Authority (LA) districts.
However, some universities command much larger premiums.
The University of St. Andrews in Fife, Scotland, has the most striking discrepancy, with the average rent in the Fife LA district standing at £804 per month, while the rent in the KY16 outcode area, home to the main campus, reaches £1,509—an eye-watering 87.9% premium.
The top rent price premiums
Several other universities also top the list for their significant rent premiums. Durham University, for example, is situated in the DH1 outcode area where the average rent is £988, a premium of 73.9% over the wider LA district.
In London, the area surrounding Imperial College London (SW7) commands an average rent of £5,363, which is 72.6% higher than the average rent in the Westminster LA district (£3,107).
Other notable universities with large rent premiums include the University of South Wales in Pontypridd (63.9%), Liverpool Hope University (58.6%), Swansea University (54.8%), UEA in Norwich (44.5%), Aberystwyth University (40.2%), the University of Warwick (36.2%), and the University of Essex in Colchester (36.1%).
‘Students are facing a more expensive university education than ever before’
Sam Reynolds, CEO of Zero Deposit, expressed concern over the rising rent prices and their cumulative impact on students’ finances, “Students are facing a more expensive university education than ever before, with tuition fees going up, the cost of living through the roof, high interest rates, and expensive rent,” he said.
However, Reynolds also pointed out another significant financial hurdle for students: security deposits.
“The cost of security deposits, which requires students to hand over a large sum of cash at the start of their tenancy, is a huge burden,” he explained. “Once the landlord has it, the student has no access to it until the end of their tenancy. This means they can’t use that money to support their studies or cover living expenses.”
Reynolds highlighted the growing demand for alternative deposit schemes, which can protect landlords without stripping students of thousands of pounds.
“Today more than ever, students need that money to support themselves,” he added. “Alternative deposit schemes are becoming increasingly popular as a way to alleviate some of the financial pressures on students.”