The Labour government’s decision to remove the VAT exemption from private school fees is set to have a significant effect on property prices, according to the founder and managing director of buying agency Recoco Property Search.
Nigel Bishop believes the true impact of the policy has yet to be felt. He said: “Another wave of parents looking to move closer to state school catchment areas is inevitable over the coming weeks.
“Before the end of April, parents will need to confirm with their children’s current school whether they intend to enrol for the next academic year beginning in September.
“Since Labour has announced a tax levy on private school fees, we have encountered numerous parents who decided to register their children with a state school instead and, as a result, are looking to move. We are currently registering even more parents contacting us for exactly this reason but they are up against a much tighter deadline to find a suitable property.”
According to Bishop, this has created an increased feeling of urgency, with many parents willing to offer sellers above asking price to secure a property.
“We therefore expect to see a particularly competitive property market for larger family homes in the UK which could see house prices go up further,” he said.
Bishop believes his expectation of growing demand is reflected in the latest Zoopla House Price Index which states that buyers have continued to prioritise houses over flats. Zoopla also revealed that the gap between the value of houses and flats is at a 30-year high, with the average house value (£319,500), 67% higher than the average value of a flat (£191,300).
