By now, university students will have settled into the new term and be looking hard at the rent they are paying on their halls of residence or student digs. Some might even be wondering, is this the most intelligent way to get accommodation?

The answer is: not necessarily. With property prices in the doldrums, buying a place and using it to offset your costs by renting it out to fellow students has become a more realistic prospect than in many years.

The Bath Building Society has been offering 100 per cent mortgages to students for the past few years on its Buy For Uni mortgage scheme, but as prices soared, parents were a lot more cautious. Moving story: Many students are learning that's sensible to buy a property, rather than rent, while they are at university.

'Now prices are more realistic, we are seeing a great deal of interest,' says the society's chief executive Dick Jenkins.

The Buy For Uni mortgage is subject to a number of conditions - such as a maximum loan of £250,000.

Student buyers typically secure the advance on their parents' property and fulfil various criteria such as finding paying tenants.

David Morgan, 67, a retired teacher, is happy with the arrangement he has made with the Bath Building Society for his daughter, Bryony, 27, who is doing a PhD at Cardiff University.

'She took her first degree at London Metropolitan and renting somewhere decent within reach of the campus was a problem, he says.

'We didn't have the money to buy something in London, and the rental market was difficult, too, but in Wales it was affordable and the 100 per cent mortgage made all the difference.'

When the Morgans bought with the Buy For Uni scheme, they were given a 1.1 per cent discount on the standard variable mortgage rate. The terrace cottage a couple of miles from campus cost £137,000 in 2007, with a further £2,500 for the fees and administration costs.

Source: The Mail
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