Top Schools in Cape Town influencing property prices
Category Cape Town Property
Edugration is a well-known phenomenon in SA, with parents changing suburbs and even cities to buy property in the feeder areas for top-rated schools – or in certain estates with their own schools - and usually having to pay a hefty premium to do so. This is evident in the Southern Suburbs of Cape Town too.
They will not only have the satisfaction of being able to place their children in these schools, but will also receive a second payoff, in the form of a higher return when they decide to sell the property than they would have made on a home elsewhere.
In Cape Town, the median price of homes in the education hub of Rondebosch, for example, is currently at least 12% higher than that in most neighbouring suburbs – but Deeds Office figures also show that prices here have risen by a whopping 141% over the past five years, compared with increases of 56% in Claremont, 54% in Observatory, and 50% in Kenilworth.
However, it seems that they are not alone in their quest to give their children the best education, or in the additional costs they are prepared to pay to do so.
In the US, continuous research is done to find the most affordable neighbourhoods with the best-ranked schools, while in the UK, new research by Santander Mortgages shows that one in four parents has moved house to be within a desired school catchment area - and paid an average of 11% more than they would have paid for a similar home in a neighbouring suburb.
The report says this premium currently translates into an extra £23 707 (about R400 000 at current exchange rates) on average – but could be as much as £71 539 (about R1,2m) for those living in London’s top school catchment areas.
The survey also found that almost 20% of parents had changed jobs in order to move and get their children into the desired school, and that 15% had settled in an area they didn’t even like for the sake of a good school.
What is more, further research by Lloyds Bank has established that this determination to secure places in certain schools is not restricted to private institutions. Its report says that UK homebuyers with children are currently willing to pay an average of £53 000 more (about R900 000) to live in an area close to a top performing State school.
Read more on this phenomenon in the full press release
Video showing SACS school in the Cape Town Southern Suburbs
Author: Barry Davies