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Parents Face 15% Premium to Join Top School Catchments as VAT on Private Fees Drives Demand

Santander’s latest research highlights steep regional disparities, with mounting social pressures on families competing for state school places after private school fees were hit with VAT.

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Overview

  • Parents indicated willingness to pay an average 15 percent premium—about £45,000 extra—to secure a home in the catchment of a good state school.
  • Homes in the catchment areas of the top 50 primary and secondary schools cost an average of £538,490, roughly 42 percent above the national market average of £379,517.
  • The January 2025 introduction of VAT on private school fees prompted over one in five private school parents to consider switching to state education, with two thirds planning to relocate for a place.
  • Regional gaps are pronounced, with London buyers facing around an £81,000 premium and north east families paying the lowest extra cost at about £26,600 on an average home.
  • Competition is imposing social and emotional strains—one third of parents considered homeschooling, many report lost friendships and sleepless nights, and average relocation distances have climbed to 31 miles even as rising listings and stabilizing rates offer some relief.