College really doesn't recommend 'living out' (ie. in privately rented accommodation) for the first year. In fact, in most colleges it is compulsory to 'live in' for the first year except in exceptional circumstances. This is because the college system is a huge part of life at Durham.
College lets you make friends really quickly, feel part of a community, join in lots of activities and generally help you settle in. It IS expensive, however a student protest on Monday is aiming to make the university reconsider it's escalating accommodation fees as students are very aware people are feeling a financial burden. That said, don't let financial worries put you off living in, as there are systems in place to support students.
If it's not finances you're worried about and more about whether you'd enjoy living in college - trust me you'll almost certainly love it. It really is the most amazing experience, most people adore their college and are painfully loyal to it. First year was honestly the best year of my life and college played a big part in that. I was terrified before going but I shouldn't have been worried!
Finally, you live out of college at least in second year, and most people live out for their final year too (although there is an option to return to college subject to space!). From a very practical standpoint, in the nicest way possible as you have never lived in Durham, if you were to try and find accommodation for yourself now you'd probably be ripped off and very unhappy. Lots of the accommodation has gone now as the main 'letting season' has passed. Durham is a city with a wide range of different accommodation options, but until you get here and experience the city for yourself and talk to older students, it is hard to know what sort of place to go for. Also, signing up to live with random people, especially in your first year is hugely risky. Having lived with some AWFUL housemates who effectively ruined a year for me I can tell you how important living with the right people is as it can have huge effects on your studies too.
My advice would be to go with college. If you have genuine specific needs that you are worried they can't fulfill, ask them, they're usually very good at helping people out. Why do you have reservations? Also what college were you allocated?
Hope this helps!