Over the past decade, average house prices in the ‘new’ university towns (those established since 1960) have increased by 70%, from GBP91,612 to GBP155,953, according to new research by Lloyds TSB.
LONDON, ENGLAND, August 20, 2011 /24-7PressRelease/ — However, mortgage customers and other types of homeowners inside the a lot more traditional, older university towns have seen house prices rise by a more modest 64% on average. Each new and old university towns recorded higher average price increases than the 62% increase across the UK as a whole. More than two-thirds of all university towns recorded house price increases in excess of the UK average1.
New University towns
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 much more students.
House prices have much 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 a lot more than doubled. [See Table 1]
Meanwhile those searching for first time buyer mortgages may be interested to learn that that the most expensive new university town – and also the most expensive of all university towns – is Winchester with an average house price of GBP364,667. It’s followed by Kingston-upon-Thames (GBP360,331) and Buckingham (GBP330,795). The least expensive are Salford (GBP106,685), Paisley (GBP106,967) and Bradford (GBP108,282).
Older University towns
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%). [See Table 2]
The ancient university town of Cambridge has the most expensive homes amongst old university towns outside London, with an average price of GBP291,079. Oxford (GBP258,531) and Reading (GBP248,076) 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 GBP106,021.
Towns in the Times University Ranking
Eleven of the university towns inside 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 (each 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. [See Table 3]
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 within the newer university towns where prices have, on average, risen much 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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