Three reasons you should buy property in good school catchment areas
One of the property fundamentals that professional investors look for when searching for the best residential investment property is a property near a good school. While this is often considered as a ‘no-brainer’, many investors ask me if it really makes that much difference. In this article, you’ll learn why you should buy residential property near a good school.
Property prices are higher near good schools
Parents are prepared to forego ‘extras’ to live near the best schools, too – such as a spare bedroom or garage. Families will more happily live in smaller homes, providing their home is in the right catchment area and their children are almost guaranteed a place in their first-choice school.
And for fewer extras and smaller homes, parents are also prepared to pay more. Of course, professional investors have always known that properties near good schools are more expensive. Research conducted by the Department for Education in 2017 has put a number on how much more expensive:
- 8% higher near the best primary schools
- 8% higher near the best secondary schools
In hard cash, in 2017 this was:
- £18,600 more near the best primary schools
- £15,800 more near the best secondary schools
In London, a property near one of the top 10% of primary schools was almost £40,000 more expensive than one that wasn’t.
One in four families move to be near a good school
Parents want to give their children the best education possible, and they are prepared to move to achieve this. In fact, a 2015 survey conducted for Santander Bank found that one in four families have moved to be in the catchment area of their desired school. One in six has either bought or rented a second property to be within a school’s catchment area.
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The survey also found that 8% of parents asked were considering buying a property near the desired school, and 17% were prepared to either buy or rent a second property to achieve the aim of providing their children with the best education.
Clearly, owning a property near a good school attracts extra demand, from both buyers and renters, which helps to support higher property prices and rents. When property markets turn down, house prices near good schools do weather the storm better.
You should profit more when buying near a good school
Clearly, property prices near good schools are likely to be higher than property prices near low-achieving schools. So, the entry price is higher, but this should also have a positive effect on the profits you could make.
The higher entry price is compensated by the extra demand for property. You should be able to charge higher rental prices.
Extra demand for property will hold prices up in cooling markets, while house price inflation should result in bigger increases in the capital gain you could make.
How do you know you are investing near a good school?
There are many ways to find out if a property is in the catchment area of a good school. Perhaps the most obvious is checking the latest Ofsted report, but you should also search on individual school websites for:
- Exam results and statistics
- Curriculums and courses offered
- After school clubs
- Testimonials from pupils and parents
You could also talk to local estate agents and letting agents, and ask the local authority for the latest ratings on schools in the area.
There are also other elements you should consider:
- SATs results
- Pupil-to-teacher ratios
- Class sizes
- Provisions for special needs students
Three reasons to invest in property near the best schools
Investment in residential property near good schools usually benefits from higher homebuyer and tenant demand.
Demand from parents willing to pay more to secure the best education for their children pushes property prices higher, faster.
Those who cannot afford to buy may decide to rent, helping to put extra demand in the rental market. Unsurprisingly, rents near the best schools are usually higher than those in close proximity to the lower-achieving schools. In short, invest in residential property near good schools and you should benefit from:
- Good-quality rental income
- Faster-rising prices in good market conditions
- Protection against falling prices in poor market conditions
Do you want to learn where the best places to invest in property UK are today? Contact Gladfish today on +44 207 923 6100 and book a strategy consultation. It could change your life. In the meantime, keep an eye on our property investment education blog – the schooling you need to maximise your property profits and create the lifestyle you deserve.
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