You live where you want, in what sort of a group you want. Seriously IT IS THE SAME NO MATTER WHERE YOU GO TO UNIVERSITY! The only difference is the city you find yourself in.
Luckily Warwick students have options. Leamington Spa, Coventry (centre, or Earlsdon/Chapelfields, or Canley) or Kenilworth.
Which one you go for (and indeed how many people you live with) is personal preference.
I'm going into third year next year but because I'm returning from Erasmus I get guaranteed campus (and it's not like I'm with a whole bunch of randoms either - my friend and I put in a group application). In fourth I'd probably opt for Earlsdon. I quite like it there, and the commute is a lot easier than from Leam (in fact, I'd get a bike and on good weather days, or even bad weather days when I didn't have anything to do other than go to a class, I'd cycle in).