This week I am going to share my pearls of wisdom around the importance of catchment areas when thinking of investing in a property.
Background
Not many children have the luxury of a ‘silver spoon’ upbringing and cannot rely on wealth to provide them with the best education possible. Those children must rely on the quality of the education on offer.
However, just because you live near a school, it does not mean you are guaranteed to be within its catchment area as they can change and are bemusing. They may not even have a catchment area.
Carlton Le Willows is a great example of this. Rated ‘good’ by Ofsted, the school in Gedling, Nottingham could be the first choice for parents when looking for a school for their children. Emotions run high around offer day for children and parents alike. So much is at stake and getting your child into their/your chosen school becomes all consuming.
As there are a finite number of places every year, the admission criteria is crucial and often overlooked by parents.
So why is this relevant to investors?
The catchment area appears as the second ‘priority’ on the school’s admission policy and appears prominently throughout the rest of the list.
Carlton-le-Willows Academy is located on Wood Lane, Gedling, Nottingham, NG4 4AA.
So, let’s have a look at the school’s catchment.
Catchment area
The catchment area for the school is controversial, with properties under half a mile falling outside, with addresses in the likes of Colwick, 2.5 miles away from the school falling within the catchment area.
Confusing right?
Therefore, someone may make the mistake of buying a house close to the school thinking the property is guaranteed to be within the catchment area when in fact, it is not. Thus, making it worth less than one that is in the catchment.
Example properties
A 3-bedroom semi-detached property for sale on Station Avenue, Gedling, Nottingham is priced at £260,000 on Right Move. Despite being just 0.4 miles away from Carlton-le-Willows, it does not fall within the catchment area for the school, and interestingly has recently been reduced in price. I would therefore personally not invest in this property. Unless it was an absolute steal of course.
A family may look at purchasing this house with their children’s education in mind, as it is a short walk to a ‘good’ school, without knowing the complicated catchment area argument. Another 3-bedroom semi-detached house property that is also in the Gedling area is priced at £290,000 on Right Move. Someone could dismiss this property when searching for a house close to a school, as it is more expensive and further away than the previous property mentioned above. It is located on Stoke Lane which is 1.1 miles away from the secondary school and the plot currently falls within the catchment area for Carlton-le-Willows.
In my view, would potentially be a better investment than the one outside of the catchment of the school.
Potential benefits of locality
The area is close to Colwick loop road, providing a route to shopping in Netherfield (Victoria retail park) 1.1 miles away and just over 1 mile (1.3 miles) from shopping in Carlton Square.
It is also just over 5 miles from Nottingham City centre, that can be accessed by the use of bus routes, 24, 25, 26 and 44.
Published Admission Number (PAN)
The proposed published admission number of Year 7 in September 2022/23 is 240 for Carlton Le Willows.
| Year
|
Applications
|
Allocated
|
Refused
|
| 2021-22
|
610
|
300
|
49
|
| 2020-21
|
655
|
300
|
86
|
| 2019-20
|
643
|
300
|
78
|
Deadlines
All applications for places in the normal year of entry are made on the common application form through the home local authority. For entrance to the academy in September 2022, the closing date of the co-ordinated admission scheme is 31 October preceding admission to secondary school. Places are allocated on 1 March 2022. This means that parents are up against a large number of other parents to secure one of those coveted places. Hitting one of the top admissions criteria, namely ‘catchment’ suddenly becomes a big if not huge deal.
Opportunity
Agents assess the market value of a property by looking at the comparable properties in the area (FACT). They should also use a few other indicators too, but I would put money on the fact that school admissions criteria will not be at the top of any of their lists.
As an independent appeals panel chair of over 12 years, I can confirm that people are buying houses or renting and then finding that their house is not in the catchment for their chosen school when the next-door neighbours’ house is.
Yet the houses were advertised as being worth the same by the selling agent. I would argue, as an investor, that they are not.
The house in the catchment is potentially worth more, and for the right buyer/renter, much more, parents will pay a premium to get their child into their chosen school. One could argue the ethics around this approach – and yes, there are many views to consider here, but I’m simply sharing my investment views on the subject. Nothing more.
I would strongly look at the schools that rated ‘outstanding’ or ‘good’ and hunt down those properties that in my opinion are being sold for less than what their true potential is and focus on those.
Word of warning
Ensure that you fully understand the admissions criteria for the school –you will need to keep up to date as the admissions policies do change.
Rent
If you were looking at a buy-to-let deal you would be looking at renting a 3-bed semi-detached property in the catchment area for £850-£950pcm.
