London house prices:improved school Ofsted rankings could add £32k value to homes in good catchment areas

Smart buyers looking for uplift should seek out homes near sink schools where a new headteacher and extra investment have recently arrived.

Click to follow
H&P

When a school rises up the Ofsted rankings, houses within its catchment area enjoy a price bounce that can earn owners tens of thousands of pounds.

The fact that parents will pay a premium to live close to a school with an established reputation for high standards is well known, but new research reveals the impact improving educational standards can have on property values.

Between 2011 and last year almost one in 10 London state schools moved up from a “good” rating by the government education watchdog to “outstanding”, while almost a third — 30 per cent — rose from a “satisfactory” performance to a “good” one.

Hamptons International has tracked the prices of homes within 100 metres, or almost 110 yards, of improving schools and found that within five years of an Ofsted upgrade, values increased by an extra 5.2 per cent over and above general market trends.

With an average asking price in London now £624,953 according to the latest data from Rightmove, this means owners living near an improving school could “earn” an extra £32,497.

The impact of improving schools will be greatest for family homes near primary schools, where catchment areas are tighter than for larger secondary schools, so really smart buyers looking for uplift should seek out homes near sink schools where a new headteacher and extra investment have recently arrived.

People living near a school which slips down the Ofsted ratings will lose money on the value of their home. Today’s research shows that prices slip by 2.4 per cent, or almost £15,000, compared to other nearby properties when a school is downgraded.

“London schools have greatly improved in recent years and this has had a knock-on effect on house prices in catchment areas across the capital,” said David Fell, research analyst at Hamptons and author of the report.

“While it tends to take two to three years for an improved rating to feed into prices, the average home near a school on the up increases in value by an extra five per cent over five years compared to the wider market.

“In the first two years after a school receives a higher rating, there’s often a flurry of sales in the areas nearby as awareness of the school’s improving reputation spreads. Longer term, schools with better reputations also increase the staying power of neighbourhoods.”

Rushmore Primary School in Hackney, E5, moved from “satisfactory” to “good” at its last inspection, back in 2012. Candy Foy, sales manager at Atkinson McLeod estate agents, said: “That pocket of Lower Clapton does achieve more than you get a little further north. Everybody wants to be near the school.” Family homes in the streets near Rushmore Primary now cost from about £1 million for a three- to four-bedroom Victorian terrace.


Follow us on Twitter @HomesProperty, Facebook and Instagram

Comments