Five Year Student Inflation Report

But as universities turn the corner on the pandemic, new clouds are on the horizon in the form of rising living costs. With the current pressures on living costs only just beginning to take their toll in the 2021-22 academic year, our next Student Living Index is likely to shed a light on the true impact they’re having.

Whether on household bills, maximising their income or going out, the UK’s innovative students will have to start thinking outside the box all over again.

The most recent decline can perhaps be explained by the greater number of students choosing less expensive university accommodation over private rentals.

In 2022, more than half of students chose university accommodation. In contrast, just one in three opted for more expensive private rented accommodation. This is a significant reversal from 2021, when only 16% lived exclusively in university accommodation. It could be a response to the 18.5% increase in rents witnessed during 2021.

In regional terms, London’s rents have consistently been the highest. However, the capital lost the top spot in 2022, when rents in Manchester took over. The average rent for students in London was around £50 less than in Manchester this year.

Average, highest and lowest student rents

Next year’s Student Living Index will confirm whether this is part of a broader trend. However, with cost-of-living pressures taking hold in 2021-22, our data suggests students could be seeking greater financial support to tackle the effects of inflation, which has an eroding impact on buying power.

The city with the highest average student income tends to change from year to year, with Cambridge topping the list twice. London, Bristol and Coventry also make appearances at the top. Cities with the lowest student incomes include York, Aberystwyth, Southampton, Glasgow and Edinburgh.

Average, highest, lowest and London monthly incomes

The cost of living has only just started to make headway as a swing factor, edging up from 3% in 2018 to 4% in our latest survey. However, university fees shot up the priority list in 2022, climbing from seventh to third place (at 10%).

Being close to home and socialising are among the other reasons students consistently give when choosing a particular university.

At least 24% tried to budget but didn’t always stick to it (2022), with this peaking at 44% in 2018. Meanwhile, the number budgeting carefully and tracking their spending has been relatively consistent since 2018. The low came in 2019 (22%), with the high recorded in 2020 (28%). All eyes will be on the 2023 survey, when the rising cost of living starts to hit home.

While budgeting lessons continue to be learnt, money management remains a source of stress to many students. The proportion reporting stress has tended to hover at around one in five, reaching a high of 23% in 2019 and 18% in the latest survey.

Learn more about student budgeting