Introduction
There is a general understanding that good schools have a considerable impact on house prices, that is, neighbourhoods with good schools are on average more expensive than those with under performing schools. This analysis seeks to determine how strong the link is between house prices and academic performance of schools.
Data and Method of Analysis
The measure for academic performance used is based on the exams and teacher assessments for pupils aged 10 or 11 in England - Key Stage 2 SATs for the academic year 2019. For each school, the percentage of children achieving a high score in reading and maths and working at greater depth in writing, is derived. Special educational needs schools have been excluded from the analysis. Most independent schools have also been excluded because they do not have to follow the national curriculum and do not tend to have stricter catchment area constraints.
House prices are based on the average sold prices of transactions completed within a 1km (0.62miles) radius of the school. All residential property types are included i.e. detached, semi-detached, terraced and flats.
After the exclusions above, a total of 14,786 primary schools out of approximately twenty thousand primary schools in England were analysed alongside their respective neighbourhoods.
In order to determine the statistical relationship between house prices and academic performance of schools, the standard correlation coefficient (Pearson’s r) is calculated using the Python Pandas data analysis library. A correlation coefficient between 0.5 and 1 is considered ‘strong', 0.3 to 0.5 ‘moderate’ and 0 to 0.3 'weak’.
Findings
Performing a broad correlation analysis across all the 14,786 primary schools in England results in coefficient r = 0.27, suggesting a weak relationship between house prices and academic performance of schools. This is not surprising, given that what is considered expensive in the Northeast is different to London in the southeast. Even within London, what is considered expensive differs by borough e.g. Newham vs Kensington and Chelsea.
Delving deeper and performing the analysis by Local Authority yields different results. Nearly half of all Local Authorities in England have a strong to moderate relationship between house prices and academic performance of schools. A positive insight is that in the other half of Local Authorities, academic performance is not impacted by how much is spent on a house - see fig 3 London Borough of Tower Hamlets.
Another way of analysing the data is partitioning the schools based on the average house price in England which is around £300,000 (April 2022). In this analysis, when considering the schools in the top 20%, there are twice as many in neighbourhoods where property prices are above the national average compared to neighbourhoods where property prices are below the national average.
In Conclusion
In conclusion, the link between house prices and academic performance does exist, however, there are some outliers which would benefit those looking to optimise housing costs and best performing schools. A list of schools in the top 20% in neighbourhoods with house prices below the national average will be added soon.