Home prices 12% higher in areas with best schools

House prices in areas which have the best schools are on average 12 per cent higher than other properties in the same region, according to new research from Halifax, the UK's fifth largest bank.

House prices in areas which have the best schools are on average 12 per cent higher than other properties in the same region, according to new research from Halifax, the UK's fifth largest bank.

Among the 20 local education authorities with the best GCSE results in 2004 - those with the highest proportion of students achieving five or more A, B or C grades - house prices were on average £25,100, or 12 per cent, higher than their region's average house price, the bank said.

In the London borough of Kensington & Chelsea, which is one of the top 50 performing LEAs, house prices were on average 55 per cent higher than the region's average, at £603,406. In the East Midlands district of Rutland, which is in the top 30 areas for good schools, house prices were 44 per cent higher than the rest of the region.

Tim Crawford, group economist for the Halifax, said: "Good local schooling clearly matters to families and also to investors when they purchase a property. This link can be hard to quantify given the multitude of factors affecting the housing market but high standards of education and high house prices do seem to go hand in hand."

Halifax said the best value region for education in the UK is Gateshead, which has the 10th best performing schools, but where house prices trade at a 47 per cent discount to the rest of the North-east region.

The best-performing LEA in the country, Redbridge in London, also bucks the trend, with average house prices trading at about 11 per cent lower than the capital's overall average. More than 68 per cent of children in Redbridge received five or more A, B or C grade GCSEs last year.