We’re approaching that time of year once again where parents are frantically trying to re-assemble stationary sets, uniforms and school supplies before their children head back to school after the summer holidays. Just about every retail outlet on the high-street will have, presumably, engineered a promotion or reason for people to spend their money with them for ‘back-to-school’.
There’s plenty of money in it, too, with millions of families preparing for another school year. Education has been hitting the headlines for exam results with GCSE, A level and other results being released in the past few weeks.
How do children affect landlords though? Well, presuming you’re a landlord who owns a residential property there will have been or there will be a time where your tenants are a family with children, or are planning to have children.
First and foremost, if the chances are high that you’re going to have a family as tenants, how can that be maximised?
Property prices, demand and rents can well be dictated by a number of factors such as proximity to good local schools, good local nurseries, transport links to these amenities, and whether parents can easily get around from their property with young children.
The BBC, in March, reported that a property close to a good school can add as much as £18,600 to a property’s value. They cited a study by the Department for Education (DfE) which has found prices are 8% higher near the best-performing primary schools and 6.8% higher near the best secondary schools.
There are, of course, arguments to be had by low income families regarding house prices restricting their children’s access to a good education, but they can be saved for another time.
The report stated that, astonishingly, if you’re lucky enough to live near one of the top 10% of primary schools in London it would add £38,800 to the price of your house. The average price in the capital at the time was £484,700 at that point, July 2016, when the report was published, but this has increased slightly.
Across average properties in England with a mean price of £232,900, this would represent a jump of £18,600 if living near one of the best primary schools.
The report marked the first time that the government have published their own data on the subject of selective education by house prices, with banks and estate agents having published their own data prior to this release.
The data also suggested that living near a high quality secondary school added a remarkable £15,800 to the value of your house.
The article also quotes research and statistics from this report and another from analysis by Teach First which found that 43% of pupils at England’s outstanding secondary schools were from the wealthiest 20% of families, while a separate study by the Sutton Trust suggested poorer children were much less likely to get places at the schools with the best GCSE results.
The DfE study looked at non-selective state schools with the highest proportions of pupils getting level four or five at Key Stage 2 and at least five A* to C grades in GCSEs, including English and maths.
It found that there is a “clear link” between the price paid for a home and access to good schools, house prices near the 10% best-performing primary schools are 8% higher than in the surrounding area and that near the 10% best-performing non-selective secondary schools, house prices are 6.8% higher.
It’s not only proximity to schools that can affect house prices and rental demand, though. Amenities within your house such as rooms that can fit baby equipment, children’s furniture and spacious stairs can also have an effect.
Certainly in suburban areas as well as rural areas, the majority of tenants seeking rental property will be families. Gardens kept in good shape with grass, child-proofed electrical outlets and appliances, soft carpeted rooms and other small adjustments can make a large difference in tempting these potential tenants.
There have been those that tend to avoid families with small children due to potential damage to the property but most landlords have reported well-kept properties, timely rent payments and good communication.
For those that have the likelihood of servicing these types of tenants, it’s well worth keeping this in mind.