Living near a poorly performing school can knock £14,000 off the value of your house
IF your house is in the catchment area of a poorly performing school you could face a £14,000 “penalty” when you try to sell.
Research by PwC has shown that living near a badly performing primary or secondary school can reduce the value of your house by up to five figures.
Overall, living near a bad primary school is better for your house price than living near a bad secondary school.
Homes near the country’s worst primary schools are worth £9,000 less than the local average while homes near bad state schools lose £14,000 of their value.
But, owning a home near a good school can add £25,000 to the price if it’s a secondary school and £27,000 if it’s a primary school.
Yorkshire and the Humber has the UK’s highest primary school premium, with houses near good primary schools costing 12 per cent more than the local average.
For secondary schools, the biggest price increase was in the West Midlands, where you could end up paying £47,000 more for a house near a good school.
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Help to Buy Isa - It's a tax-free savings account where for every £200 you save, the Government will add an extra £50. But there's a maximum limit of £3,000 which is paid to your solicitor when you move. But, be quick - the current scheme closes to new savers on 30 November.
Help to Buy equity loan - The Government will lend you up to 20 per cent of the home's value - or 40 per cent in London - after you've put down a five per cent deposit. The loan is on top of a normal mortgage but it can only be used to buy a new build property.
Lifetime Isa - This is another Government scheme that gives anyone aged 18 to 39 the chance to save tax-free and get a bonus of up to £32,000 towards their first home. You can save up to £4,000 a year and the Government will add 25 per cent on top.
Shared ownership - Co-owning with a housing association means you can buy a part of the property and pay rent on the remaining amount. You can buy anything from 25 to 75 per cent of the property but you're restricted to specific ones.
"First dibs" in London - London Mayor Sadiq Khan is working on a scheme that will restrict sales of all new-build homes in the capital up to £350,000 to UK buyers for three months before any overseas marketing can take place.
Starter Home Initiative - A Government scheme that will see 200,000 new-build homes in England sold to first-time buyers with a 20 per cent discount by 2020. To receive updates on the progress of these homes you can register your interest on the website.
But, the five per cent house price premium near London’s schools is more costly, adding an extra £32,000 due to the capital's higher house prices.
One of the main things that influences house prices near to schools is Ofsted ratings.
All schools in the UK are regularly inspected by the Office for Standards in Education (Ofsted).
It gives every school visited a rating ranging from inadequate to outstanding, and it is this rating that influences the value of nearby homes.
The other important factor is school catchment areas - a catchment area is the area a child must live in to be able to attend a certain school.
Properties in the catchment area of schools with good ratings are more sought after because parents hope to get their children into the school.
Equally, homes near bad schools are less desirable for families with children are so can be harder to sell.
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This increased or decreased demand influences local house prices and creates the so-called school “penalty” or “premium”.
The research also pointed out that house price premiums near good schools made it harder for low-income families to live in the area.
Jamie Durham from PwC said: “High house prices around good schools have the potential to lock out poorer families from the best performing schools and, while the amount varies across England, it remains a significant obstacle to social mobility across regions.”
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