Making the right call on which university to go to is one of life’s major decisions. Pick the wrong one and you can be saddled with a debt of £35,000 and little to show for it.
Now parents have another consideration: house price growth in some university towns is predicted to be strong enough to pay off the tuition fees at the end of a three-year course.
Online estate agent HouseSimple.com has calculated that it could be worth investing in a buy-to-let property or a second home while junior is at university as once they graduate the profit on selling the house could clear their debt.
For example, an average property in Manchester is currently £147,700, while house prices have risen on average £10,036 a year over the past three years. That’s a total profit of £30,108 to cover course fees, says HouseSimple.
Similarly, in Birmingham the current average property price is £153,926, and prices have increased £42,697 since 2013. If the average rate of growth continued at the same level for the next three years, parents with children studying at Birmingham or Aston could cover tuition fees and general living costs on house price growth alone.
Below are 10 of universities towns or cities where parents could literally pay for their son’s or daughter’s education:
Top of the league: De Montfort University in Leicester
Leicester:
Av house price: £144,118
Predicted growth: £21,917
Worth reflecting on: Media City, Manchester
Manchester:
Current average house price: £147,000
Predicted growth over next 3 years (based on rises since 2013): £30,108
Historic: Coventry Cathedral is at the heart of the university city
Coventry:
Av house price: £153,926
Predicted growth: £26,625
Seat of learning: Birmingham’s new city library
Birmingham:
Av house price: £156,153
Predicted growth: £42,697
Imposing: the halls of residence in Norwich
UAE, Norwich:
Av house price: £182,114
Predicted growth: £36,185
Bookish: Portsmouth University library
Portsmouth:
Av house price: £185,365
Predicted growth: £335,284
Life’s good: the Life Sciences building in Southampton
Southampton:
Av house price: £188,140
Predicted growth: £36,520
Good prospects: Cardiff University
Cardiff:
Av house price: £188,251
Predicted growth: £31,599
Sporting excellence: Olympic champion Jessica Ennis-Hill at Loughborough
Loughborough:
Av house price: £193,606
Predicted growth: £30,542
Historic: the entrance to King’s Manor, part of York University (Pictures: Getty)
York:
Av house price: £229,881
Predicted growth: £42,697
Alex Gosling, CEO of HouseSimple, said: “For those parents fortunate enough to be able to afford a second property, there could be a way to give your offspring a debt-free start in life, depending on where they go to university. By investing in a second home, your child won’t have to pay living costs, as the rent will cover that, and the increase in capital value could cover the cost of tuition fees.”
Lloyds Bank reports today that parents in England face paying a premium of £53,000 typically for their family to live near a top-performing state school.
Average property prices have reached £366,744 in the postal districts of the 30 state schools in England which achieved the strongest GCSE results in 2015, typically 17% higher than homes in neighbouring postcodes.