Most expensive place to study? Not for much longer

The Sydney Morning Herald | Fairfax Media | Getty Images

Australia is the world's most expensive destination for foreign students, but thanks to a weakening currency, the popular venue for education is set to become more affordable.

According to a report from HSBC, Australia currently tops the rankings of the costliest nations for higher education, with annual expenses topping $38,000 a year. But that could change with the Australian currency tumbling more than 12 percent against the U.S. dollar this year.

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Graham Heunis, head of retail banking and wealth management at HSBC, says the strong Aussie dollar in recent years have dealt a blow to local tertiary institutions, traditionally a popular choice among foreign students for its international recognition and relative proximity to the rest of Asia.

Foreign student enrollments in the country have fallen 12 percent between 2009 and 2012. During that time, the Australian dollar rose around 50 percent versus the greenback.

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"Having withstood the cost pressure of the high Australian dollar for the past three years, Australia's tertiary institutions could see international student numbers swing back with the falling Australian dollar," Heunis said.

After Australia, United States and United Kingdom are the next most expensive places for foreign students pursuing tertiary degrees, with annual costs at around $35,000 and $30,000 respectively,according to the survey.

Singapore, Hong Kong, and Japan are among other Asian nations in the top 10 rankings, costing overseas students an estimated $24,000, $22,000 and $19,000, respectively, per year.

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HSBC forecasts the Aussie dollar to fall further this year, with a target price of $0.86 by the fourth quarter, which is another 5 percent downside from its current level of $0.91.

Apart from a falling currency, HSBC expects improved visa processing methods to increase the influx of international students.

"While Australian universities may have seen a dip in international enrollments in recent years, the falling Aussie dollar and simplified visa process should spark a resurgence in overseas students, placing Australia on top of their destination lists," said the report.

— By CNBC.com's Nyshka Chandran. Follow her on Twitter @NyshkaCNBC