Unreal Engine is free for teachers and students

Epic Games is committed to supporting students and schools, and helping companies that license Unreal Engine 4 find and hire qualified developers. So, starting now, Unreal Engine 4 is free to use for colleges and universities. The engine can be installed and used on all school owned computers, and personal copies can be provided free of charge to all students enrolled in accredited video game development, computer science, art, architecture, simulation, and visualization programs.

In addition, schools and their students will receive regular updates as if subscribed, but without having to pay the $19 monthly fee. Launch of commercial products is still subject to the 5% royalty.

More info on Unreal Engine site.