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Will Buyers Pay a Premium for a Good School?

  • 7 years ago

September and October are the months when parents up and down the UK apply for their children’s primary and secondary school places. They’ve got until January to get the paperwork in and then it’s an anxious wait until April to find out the results.

If they’re already living in the catchment area of a good or outstanding school, then all’s well and good. However, many people are prepared to move house – and pay a premium – to be in such a location.

Fierce competition

In England, 86% of the schools rated as outstanding by Ofsted are over-subscribed, which makes one wonder where all these children are; surely, they can’t all be in the catchment area?

This also leads one to ask exactly how much parents are prepared to pay to move to an area that’s in the catchment area for a good or outstanding school.

The answer is quite a bit, it seems. Property portal RightMove found that on average, the premium paid by people moving from a “requires improvement” catchment area to an outstanding one is £52,372. This differential rises to over £80,000 in London.

Only one in five state primary schools are rated “outstanding”, with 62% being “good”. The premium for moving from “good” to “outstanding” is no small fee, either; £36,889 on average.

This might seem eye-watering, but compare this to the ever-rising cost of private schools. Plus, once the kids are off to uni, the parents have the option of selling up and making a killing on the investment.

Throwing money around doesn’t always solve the problem

However, just being prepared and able to pay the “outstanding” premium doesn’t guarantee a place. Some schools have very small catchment areas; school-savvy parents are already aware of this and it’s pushing up prices even further.

All areas in England around good and outstanding schools will see a flurry of property activity between now and January when school applications close. If you’re going to market and your local school is “outstanding”, then you need to make this very clear, as you can be certain that people will pay the price!

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