Education drives 4% of residential property purchases by ultra-high-net-worth individuals (UHNWIs) globally, according to Knight Frank. This led to a spend of £2.3bn in property purchases across London alone in 2020.
Demand varies by geography. A greater proportion of education-driven purchases takes place among Asian, African and Middle Eastern UHNWIs. However, it is clear there is enough demand created by top-quality education to move property markets – particularly across London and other key cities.
Flora Harley, a partner in Knight Frank’s global research team said:
The UK’s internationally renowned education system and world-leading universities have often been a target for children of UHNW families and this has played a part in the demand for prime residential property. With London coming out at the top of Knight Frank’s City Wealth Index for quality and number of universities, it unsurprising that the UK capital attracts over £2bn from parents looking to secure accommodation during the time their children spend studying here.”
Universities remain in focus
Demand to seek higher education abroad remains largely undimmed. Some 14% of UHNWIs were more likely to send their children overseas because of the pandemic and more than half said the crisis had no effect. The UK, which is home to a number of world-class universities, is a key destination for higher education and is likely to remain so.
Applications for the 2021/22 academic year confirm this data. According to UCAS the number of applications to UK universities rose by 22,500 for the year, with a 17.1% increase from non-EU domiciles.
After UK nationals, the greatest demand comes from those domiciled in the Chinese mainland, India, the US and Hong Kong. For the January 2021 deadline, applications from these four nations increased by 25%, with Chinese mainland domiciles accounting for 4.2% of all applications (up 21.5% on the year before).
Positive prospects for schooling in the UK
UK schools also feed into a substantial pool of demand for property, particularly for markets around London, the south east and south central UK, where more than half of the UK’s independent schools are located. In this case, the pandemic has led to some reassessment. 45% of UHNWIs were less likely to send their children abroad, meanwhile just over half of UHNWIs did not change their plans to send their children overseas for secondary education or were more likely to do so.
A census of almost 1,400 schools by the Independent Schools Council (ISC) revealed a small decline in the number of international students with parents residing overseas.
In a similar pattern to university applicants, the largest number of non-British pupils are those from the Chinese mainland, of which 71% have parents living overseas; Hong Kong, where 92% have parents overseas; and the US, where in the opposite fashion 90% have parents living in Britain.
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