53 per cent of students from poorer families are forced to choose universities closer to home, according to a study by the National Union of Students (NUS).
Those from families who have manual jobs in socio-economic classes D and E were found most likely to study at home due to financial hardship.
The findings come as part of a poll conducted by the NUS in association with HSBC. 3,135 undergraduates at 146 universities and colleges across the UK were surveyed.
Confirming the results of the study, NUS president Wes Streeting said: "Fees and spiralling living costs are forcing those from poorer backgrounds to choose a university close to home.”
Out of the students whose families have professional jobs in socio-economic class A, only 22 per cent made the decision to live at home.
The survey, which has been named the “first major study into the student experience” focussed on all aspects of student life, from choosing a course and university in the first place, to accommodation, student employment and general welfare issues.
With a government-led review on the third year of tuition fees expected later in 2009 there are fears that the current cap of £3145 could be lifted. This, claims the NUS, would mean many students barely hovering above the poverty line would be forced into even greater financial difficulties and prospective students would be deterred from applying at all.
Speaking to The Journal, Mr Streeting explained how the study might convince ministers that lifting the cap is the wrong decision.
He said: “This report gives us an unprecedented insight into the experiences and concerns of students.
"We look forward to working with tutors, institutions and the government to address the issues raised by students through this survey.
"This has to be taken into account in the forthcoming review of higher education funding. We cannot allow fees to continue to exacerbate this problem."
The survey also found that students underestimated the cost of living by £450 on average each year.
Government grants and bursaries added to the confusion as 42 per cent of students initially thought they were entitled to these benefits when in fact only 28 per cent were eligible.
Despite the largely negative feedback from the survey, 85 per cent of students claimed not to regret their decision to go to university.