Competition for school places in some of the UK’s best educational establishments is affecting the private rental market with more homes near them being rented to families, new research suggests.
Some 28% of listings rented around schools with outstanding ratings from school inspectors OFSTED went to families with children, up from 26% in 2014 and 9% in 2008
In London competition for school places means that for the first time over half of listings rented around the best schools go to families with children, according to the latest quarterly lettings index from Countrywide plc.
The firm suggests that while this is a product of the significant increase in competition for school places, the growing number of families living in the private rented sector means more of them move both for work and their children’s education.
While the figures in London are most marked for schools rated outstanding, the pressure on school places in the capital means there has been uplift in families with children renting in the area surrounding most schools.
Given it is the address from which the school application is made in January that the application is assessed against, the summer months are when most families think about moving. Over half of families with children in the private rented sector move during June, July, August or September in time for the forthcoming academic year.
Households with children moving into the area close to an outstanding school don’t move far, an average of just half a mile. This confirms the fine margins involved getting into school catchment areas. This distance is considerably shorter than the three miles the average households in the private rented sector moves, the report explains.
As with house prices, tenants pay a premium to live close to a high performing school. Given tenants move more often than home owners, this premium tends to be smaller. In 2015 the average tenant living within a kilometre of a school rated outstanding paid 14% more than someone living more than a kilometre away.
While the premium attached to one and two bedroom flats is almost negligible, tenants living in three or four bedroom houses pay an average of 16% more. Where catchment areas are particularly tightly defined, a house on one side of the road can be let for 15% to 20% more than an identical house on the other side.
‘There are 1.6 million families with children living in the private rented sector, 20% more than last year, which means school catchment areas are becoming increasingly relevant to the rental market,’ said David Fell, research analyst at Countrywide.
‘Many of these families are choosing to rent close to the school gates and in some cases parents are taking advantage of the flexibility of renting to move from the fringes of their preferred school’s catchment area to ensure their child’s entry,’ he pointed out.
‘The flexibility of renting can present a challenge for schools, where competition for their places is high, particularly as some less scrupulous owners have in the past rented homes to try to secure a place in a school. Schools are becoming increasingly savvy now, ensuring the home is a family’s permanent residence rather than somewhere which has been rented for a few months during the application process, he explained.
‘The growth of families with children renting is just one of the changes the sector will see as the number of renters in all different stages of life continues to grow. Adapting to provide for these changing needs is a big challenge for the sector,’ he added.
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Source: Property News Spain