"There are many ways parents can support adult children onto the ladder, for example, through joint borrower, sole proprietor options or regulated buy-to-let, which allow family members to live in the property or specific ‘buy for university’ products, which don’t even require a deposit"
- Stephanie Daley - Alexander Hall
Parents are increasingly purchasing properties near universities to reduce the financial pressures faced by their children during their studies, according to new analysis by mortgage broker Alexander Hall.
The firm reviewed monthly mortgage costs across postcodes covering the UK’s top 100 universities and compared them with average rental prices to determine where buying a home could offer the greatest savings. The results identified Sunderland as the most affordable for mortgage repayments and Glasgow Caledonian University as providing the largest gap between the cost of owning and renting.
Rising parental support
Students have long faced financial hardship, but recent increases in tuition fees, higher living expenses, and rising rents have intensified the challenge. Alexander Hall reported that more parents are choosing to invest in property for their children, reducing reliance on rental accommodation.
This approach provides several advantages:
Lower monthly costs compared with renting.
Potential long-term investment value through student lets.
Early access to the property market and equity building for the student.
Most affordable university mortgage costs
The University of Sunderland leads the list for affordability. In the SR1 postcode, the average property price is £59,454. With a 15% deposit of £8,918 and a loan of £50,535, the average full monthly mortgage repayment is £275 based on a 4.21% interest rate over 25 years. Some mortgage products also allow purchases for university lets without requiring a deposit.
Other universities offering lower monthly repayment levels include:
Teesside University at £361 per month.
University of Aberdeen at £435 per month.
Biggest savings versus rent
When comparing mortgage repayments to rental costs, Glasgow Caledonian University ranks highest. In the G4 postcode, the average mortgage payment is £806 a month, which is £535 less than the average rent of £1,341.
Strong savings are also seen in:
University of Strathclyde, G1 postcode, £502 less.
University of Leeds, LS2 postcode, £488 less.
Newcastle University and Northumbria University, £484 less.
University of Sunderland, SR1 postcode, £397 less.
University of South Wales, £396 less.
Cardiff University, £371 less.
Nottingham Trent University, £356 less.
University of Nottingham, £355 less.
“Securing a place at university is something to be celebrated, and this September, hundreds of thousands of first-time students will leave home to take that first step into the wider world,” commented Stephanie Daley, spokesperson for Alexander Hall. “Not only is it an understandably daunting experience living away from home for the first time, but it’s also one that comes with a significant financial burden due to the high cost of living and renting. It’s for this reason that we’ve seen a growing trend of parents opting to help alleviate this strain by investing in a property for their child, and for many, this parental support is essential.
“There are many ways parents can support adult children onto the ladder, for example, through joint borrower, sole proprietor options or regulated buy-to-let, which allow family members to live in the property or specific ‘buy for university’ products, which don’t even require a deposit. This allows students to access housing without overstretching on rent, benefit from the lower cost of a mortgage repayment, and start building equity in a property. It’s a practical way for students to get ahead while studying and helps them take their first steps on the property ladder before they’ve even graduated.
“It’s also important to note that, whilst the wider cost of renting a property at university is often shared by multiple students within the same household, the same also goes for investing in a property for your child, giving them the opportunity to let to other students, helping to further reduce the mortgage costs associated with the property. For this type of lending, professional advice is paramount to ensure buyers take the correct mortgage type, which allows the letting of multiple rooms in the home.”
