Families are forking out nearly £130,000 above average property values to secure a place for their children at sought-after schools, says Lloyds Bank.
What’s the latest?
Parents are paying nearly £416,000 to buy a home near one of England’s top state schools.
The typical home close to one of the top 30 best performing secondary schools – defined as those that achieved the best GCSE results – costs £415,844.
The sum is a massive £128,615 or 45% more than England's average house price of £287,229, according to Lloyds Bank data.
But despite the high premiums commanded by properties close to some schools, homes in the catchment area of 14 of the top 30 best performing schools actually have prices that are below the average for the area.
Why is this happening?
Andrew Mason, Lloyds Bank mortgage products director, said: “All parents want to ensure their children get a good education, so it’s not surprising that homes in areas close to the top performing schools typically command a significant premium over the surrounding area and high demand has led to prices being out of reach for many buyers.”
Demand has also led to house prices in areas close to good schools outperforming other areas.
In the past five years, the typical cost of a home in the catchment area of a sought-after school has increased by 39% or nearly £117,000, compared with a rise of just 22% or £51,264 for the whole of England.
Who does it affect?
Strong house price growth is likely to have left many parents struggling to afford a property near the school of their choice.
The average house price of £415,844 in the postal districts of the 30 best performing state schools is nearly 11 times average annual earnings of £38,730.
The income multiples needed to buy a home close to some schools are even higher, with properties close to Henrietta Barnett School in Barnet, London, and Beaconsfield High School in Buckinghamshire more than 22 times higher than average annual pay in the area.
Sounds interesting. What’s the background?
Homes near Beaconsfield High School command the biggest premium, costing £643,181 or 158% more than properties in neighbouring areas.
Homes close to Henrietta Barnett School have the second highest premium at £367,632, followed by Dr Challoner’s Grammar School in Buckinghamshire at £246,598 and the Tiffin Girls’ School and Tiffin School in Kingston upon Thames, both at £167,628.
But parents do not always have to pay over the odds to live close to a good school.
With an average price of £288,430 properties near Reading School and Kendrick School, both in Reading, are actually £132,718 or 32% below the county average.
Living close to Aylesbury High School in Buckinghamshire also costs an average of £112,674 less than surrounding areas, while homes in the catchment area of King Edward VI Handsworth School in Birmingham are around £82,640 cheaper.
Meanwhile, properties in the postal district of King Edward VI Handsworth School in Birmingham are the least expensive homes close to a top school costing an average of £113,675. They are also the most affordable with a house price to earnings ratio of just 3.7.
Top 3 takeaways
- Parents are paying nearly £416,000 to buy a home near one of England’s top state schools
- The sum is a massive £128,615 or 45% more than average house prices in England
- But homes close to 14 of the top 30 best performing schools actually have prices that are below the average for the area
- In separate research, the Bank of Scotland found that parents pay a £41,000 premium on average to live near a top performing school compared to average house prices across Scotland
- Homes near Cults Academy attract the highest premium, of £102,497 (52%), compared to average house prices in neighbouring parts of Aberdeen City
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