Good Schools can add £21k to a Property’s Value

29th August 2014 posted in Property News Home Lifestyle

New research from Lloyds Bank has found that a top state secondary school can add around £21,000 to the property prices in the surrounding area.

Beaconsfield High School in Buckinghamshire has caused families to pay the highest premium ever to live there, with the average property price now standing at £796,909. This is 154% more than the average house property value across the country.

At Beaconsfield High School, 75% of the pupils recently received an A or A* in their GCSEs, meaning families are now keener than ever to send their children there for their education.

The top 30 state schools in England include Clitheroe Royal in Lancashire, St Olave’s in Kent and St Saviour’s, which is also in Kent. Property near the Bishop Vesey’s grammar school in Sutton Coldfield was recorded as being the second most sought after school in the country.

The study found that parents will now pay up to £21,000 more, in order to secure a house near one of these prestigious schools. The average price of a property closely situated to a good school is £268,000 in comparison to the average national house price of £247,000.

The southeast has the highest level of competition for property located around top rated schools, with house prices recorded to be around 27% higher than the national average.

House price figures from the Land Registry and GCSE performance data from the Department of Education found that over half of the top 30 state schools in the country are actually located in places where the average house price is lower than those in neighbouring areas.

Homes in the Beaconsfield High School region cost nearly 18.2 times the average annual local earnings, whereas properties near Heckmondwike Grammar school in West Yorkshire are more affordable at just 3.2 times the annual local wage. This shows that it is possible to find a good state school in an area where house prices are still relatively low.

The mortgages director at Lloyds Bank, Marc Page, said:

“There is strong competition for properties in areas where state schools are providing top quality education, often in locations with limited supply, which is supporting prices.

"Although property values can be significantly lower in neighbouring areas, many parents don't appear to be put off paying a premium to ensure their child has the best possible chance to attend their chosen school."

Almost every single house in the list of top state schools has very selective entry requirements and they generally take in the top 25% of children academically. The majority of good schools also use a catchment area, outside of which they won’t accept applicants from. This makes it more important for parents to buy a house in a good catchment area.

This data seems to show that the rocketing costs of private education is driving demand for top state schools with good pass rates, and leading to an increase in house prices in the surrounding postcodes.

State education is supposed to be free, and therefore equally accessible to all children, but wealthier people are now buying their way into good catchment areas in order to send their children to these top schools and Lloyds Bank has warned: “Those on average earnings are finding it difficult to purchase a property close to many of the best state schools.”