The reason for this post is because I often read other investors post about looking for a property in an area where they have good schools. We did that. We bought a home in Burbank, California, a very expensive suburb of LA, because the school system was rated really high compared to the other schools in nearby cities. But after a year of my wife checking our kids out of school early to take them to acting auditions, she got fed up with the annoyance of the school system (not to mention the socialistic and extreme liberal political climate of the schools in LA). So she pulled them out of school and started to homeschool them. So it really didn’t matter as much whether we lived by a good school or not at that point and we could have purchased a cheaper property that was bigger and nicer for a lot less by going just a little farther outside of Burbank. I am starting to see a lot of alternative schooling options now-a-days, especially in Arizona where I also live and invest. Here are some alternative schooling options. You can: • Go to your neighborhood school • Get an exception to go to another school outside of your area (this happens all the time by the way) • Go to a charter school • Go to a Montessori school • Go to a private school • Go to an academy • Do online school • Do home school • Do a mix of online and home school • Do a co-op school And I’m sure there are others I’m not familiar with. So if in your listing for the property you are renting or selling you state the excellent alternative schools in the area, does it really matter which school district you buy in if the boundaries are a lot less ridged than they used to be? What are your thoughts?

In my area... • Exceptions are not guaranteed and you have to re-apply every year • Many families don't want to transition peer groups from elem to middle to HS • Charter school lotteries only admit a small % • Private school tuition is expensive • Even if you choose private school, it's wise to have a good backup public school if you have to make a change • Only a small fraction of families home school or hybrid with a classical curriculum • Peer group matters too 1st thing I analyze is demographics and schools, particularly when vetting out of state investments.

Is BUYING in a GOOD SCHOOL DISTRICT even that important anymore?

Donald SaintVal

New to Real Estate · Boca Raton, FL · Member since 2019 · 27 posts · 37 votes

7y

It absolutely still matters, and no less than before. The number one factor for any parents when buying a home is area schools. Yes there are alternatives, but most who are searching for the alternatives are those who cannot be in their desirable school district.

25 Reply

Matt Nusbaum

Rental Property Investor · Annapolis, MD · Member since 2011 · 232 posts · 170 votes

7y

@Shiloh Lundahl I can understand your line of thinking but I would say most people do not think that way. It sounds like you may be a little biased based on your personal experience and homeschooling. Again, I would say that's the minority of people. I totally agree with @Donald SaintVal that is does still very much matter.

7 Reply

Jay HinrichsBusiness Member

Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes

7y

YUp schools number one driver of values for owner occ hands down..

in some areas of the country academy's are SOP as the public school system does not cut it.

not so much west coast there are private schools sure.. however nothing like in other areas of say the deep south I have

invested or worked in.. its a thing and a big thing.

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Mike Dymski

Investor · Greenville, SC · Member since 2016 · 5k+ posts · 13k+ votes

7y

In my area...

Exceptions are not guaranteed and you have to re-apply every year
Many families don't want to transition peer groups from elem to middle to HS
Charter school lotteries only admit a small %
Private school tuition is expensive
Even if you choose private school, it's wise to have a good backup public school if you have to make a change
Only a small fraction of families home school or hybrid with a classical curriculum
Peer group matters too

1st thing I analyze is demographics and schools, particularly when vetting out of state investments.

6 Reply

Jay HinrichsBusiness Member

Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes

7y

Originally posted by @Mike Dymski:

In my area...

Exceptions are not guaranteed and you have to re-apply every year
Many families don't want to transition peer groups from elem to middle to HS
Charter school lotteries only admit a small %
Private school tuition is expensive
Even if you choose private school, it's wise to have a good backup public school if you have to make a change
Only a small fraction of families home school or hybrid with a classical curriculum
Peer group matters too

1st thing I analyze is demographics and schools, particularly when vetting out of state investments.

schools have always been a main driver in real estate values since I started selling RE as an agent in 1975.. its never wavered.. only gotten more critical now with all the scores on line etc.. And private schools are can be tough to get into.. for instance one of my Colleagues Lives in Honolulu and public schools in Hawaii can be suspect.. they tried to get their daughter in to the school O bama went too.. this was for first grade you had to go through and interview process.. get her coached up for that interview and then school is as expensive as collage all for grade school.. their daughter did not interview well and was not accepted.. so even though they have the means does not mean they can get into private school.. :So they moved from their condo down town and bought a home in Kahala were the public school was acceptable.. I suppose for investors its not as critical as we see thousands of them buying low value C class assets throughout the US and those are generally in areas of low scoring schools.. but it is what it is..

When you take the price of a top notch private school and then use those monies to pay for mortgage payment private schools could exceed your mortgage payments many times.. depending on area..

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Jay HinrichsBusiness Member

Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes

7y

Shiloh my parents move to Cupertino in the 60s for the school system even back then.. and fast forward to today between Cupertino and Palo Alto those are the two cities I lived in and the schools are renowned and so are the values its not only because of apple and other tech its because of the school systems.. IE parents will pay 2 mil for a 1500 sq ft rancher..

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Scott Mac

Austin, TX · Member since 2019 · 5k+ posts · 5k+ votes

7y

Hi Shiloh,

If you think about it, there is absolutely no difference in "Schools" schools are just building with teachers in them all teaching the same government (mostly useless to the student) regulated things.

They are all the same, the only difference is between the children who attend (of fail to attend) them.

That is what they are rating, the children and not the schools. Despite calling it "School Ratings".

None of them teach anything of useful future value to anyone beyond basic reading and basic math.

The ratings you are referring to is how well the students at a particular school behave and how well they do "Exactly" what they are told by the teachers, and the students smartness level at a particular school.

There are a lot of political issues surrounding the American School System, with different beliefs about it by different groups of people.

Does it effect desirability of homes, yes it does for a variety of different reasons for different groups of people.

Just my 2 cents.

Good Luck!

11 Reply

Frank Wong

Real Estate Broker · Bay Area · Member since 2018 · 1k+ posts · 3k+ votes

7y

Schools matter for the value they always have and always will. Cupertino and Palo Alto great examples by @Jay Hinrichs Both cities are highly coveted because of the schools and values reflect that. Now does going to a great school guarantee your success in life? No, but it makes it much easier and removes a lot of obstacles. I am a big believer in parenting and up to the individual to make happen for themselves. I mean I went to a ghetto school and I turned out fine. lol

2 Reply

Jason D.

Rental Property Investor · St. Petersburg, FL · Member since 2017 · 3k+ posts · 4k+ votes

7y

@Shiloh Lundahl school quality matters. If for no other reason than most renters are lower income and cant afford some of those options, or arent even aware that they are available.

A huge majority of people still send their kids to public school, so you'll be eliminating a huge pool of renters if you buy in the wrong location.

2 Reply

Joe VilleneuvePro Member

Plymouth, MI · Member since 2013 · 13k+ posts · 19k+ votes

7y

Yes and no. Yes, for all the reasons mentioned above. No, because it doesn't matter to everyone. Not all highly rated school districts are profitable for flippers, or cash flowable for holders. The rent, and the sold comps help establish the profit and the cash flow by setting one end of the analysis...the "exits".

However, it doesn't mean the spread between the expenses (rentals) and the available cost to buy (flips) works for profit and cash flow.

What I'm saying is it matters to the buyers and tenants, that it matters to.

So, how do we as REI know? The numbers (spreads) with $ in front. When we analyze markets, and we find flip profitability and/or cash flow ability, we know whatever the school district is in that area mattered to those that bought or rented in that area...good, or not as good.

5 Reply

Matt R.

Sherman Oaks, CA · Member since 2013 · 3k+ posts · 2k+ votes

7y

There are more options today and growing. The majority still desire better public school options but for LA this other home school niche is growing for the reasons you experienced. My daughter goes to a charter, which I am default zoned for. The reason I moved was to get into that charter 100%.

0 Reply

Wes Blackwell

Real Estate Agent · Phoenix, AZ · Member since 2016 · 738 posts · 1k+ votes

7y

@Shiloh Lundahl

While there are many alternative options available today, I think that school ratings matter for the simple fact that people think they matter.

Since people think it matters, it puts those areas in higher demand, which helps keep home values high. Which is why areas with great schools always cost more than areas that don't.

As for myself, I was recently looking at a new build for myself a couple miles south of the Phoenix Stadium near Westgate. Great value for the property... but the local high school has a 3/10 rating and that made me consider home schooling as a potential option for my son.

Sure, I could get into a better school district, but now I'm paying $50-100k more for the same house. LAME!

School Ratings matter, and always will, because people who can afford to be choosy simply can't bear the thought of sending their precious child to a less than stellar school and having the kid turn out dumber because of it lol.

For someone that has the option to home school, I think it's a far better option and allows you to get the best of both worlds. But for most people it's not an option (and schooling IS mandatory) which means it will always have an affect on property values as long as it remains that way.

0 Reply

Theresa HarrisPro Member

Member since 2019 · 15k+ posts · 11k+ votes

7y

For you and your lifestyle it won't matter, but for many others who don't home school or have the flexibility to do so; it will matter. Not all of your renters will have school age kids, but think long term and what happens when you want to sell your home.

1 Reply

Anthony Rosa

Rental Property Investor · New York City · Member since 2019 · 703 posts · 538 votes

7y

Good school system matters big time because its desirable for families, better neighborhoods and a huge selling point. People leave the city (cities have cheaper taxes compared to suburbs) to go to a desirable suburb because of a good school district. Id rather pay higher taxes, get a better neighborhood, get a better school district than living in a cheaper tax area and sending my kids to private school. In the end, ill end up paying more. In my area if you don't have the zip code for the school district then you cant go to the school, no exceptions.

0 Reply

Pat L.

Rental Property Investor · Upstate, NY · Member since 2012 · 3k+ posts · 3k+ votes

7y

We have several rentals in 2 different great school districts & they are never vacant. We had one unit taken 1st/last & security while it was torn apart to the studs just so they could register the address at the school.

0 Reply

Connie Chan

Investor · Member since 2017 · 239 posts · 149 votes

7y

@Shiloh Lundahl I think it still helps for 1) downside price protection and 2) also getting longer term tenants. The thing is school ratings change so while its a nice to have, dont make the purchase decision based on it.

0 Reply

Anthony Wick

Rental Property Investor · Ankeny, IA · Member since 2017 · 2k+ posts · 3k+ votes

7y

@Shiloh Lundahl

Of course it matters. Very few people can afford to take their kids to acting lessons and not work and home school them. Good school districts also go hand in hand with higher rents and nicer properties. I only invest in good school districts.

2 Reply

Anthony Wick

Rental Property Investor · Ankeny, IA · Member since 2017 · 2k+ posts · 3k+ votes

7y

@Scott Mac

You literally could not be more wrong. More affluent areas, higher property taxes, better buildings for schools, more local money spent on education, better salaries and benefits equals better teachers applying. I just have no idea where you got your information from.

5 Reply

Anthony Wick

Rental Property Investor · Ankeny, IA · Member since 2017 · 2k+ posts · 3k+ votes

7y

@Shiloh Lundahl

Watch this video if you don’t think schools matter.

https://m.youtube.com/watch?v=YrHIQIO_bdQ&feature=youtu.be

0 Reply

Pat L.

Rental Property Investor · Upstate, NY · Member since 2012 · 3k+ posts · 3k+ votes

7y

Originally posted by @Anthony Wick:

@Scott Mac

You literally could not be more wrong. More affluent areas, higher property taxes, better buildings for schools, more local money spent on education, better salaries and benefits equals better teachers applying. I just have no idea where you got your information from.

Well he did qualify his advice being worth 2 cents.

5 Reply

Jay HinrichsBusiness Member

Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes

7y

Originally posted by @Anthony Wick:

@Scott Mac

You literally could not be more wrong. More affluent areas, higher property taxes, better buildings for schools, more local money spent on education, better salaries and benefits equals better teachers applying. I just have no idea where you got your information from.

Exactly or in better school and more affluent areas parents donate time and money even to public schools you don't see much of that in lower economic strata areas.. it really follows the housing stock grade system as well if you have D and F housing you primarily have D and F schools. ???

Now I have seen some changes were the Oh I am trying to think of the term but there is one in North Charleston were I have built some homes and 15 years ago N. Charleston was not a real desirable area high crime low income etc etc.. Oh I got it they call them Magnet schools a brand new one got built were kids have to qualify to get in or live there and next thing you know there is new development and housing going in a a bunch of regentrification .. all because this school got built there..

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1 Reply

John Condlin

Realtor · Charleston, SC · Member since 2019 · 2 posts · 1 vote

7y

I think that it depends on what your goal is as a buyer/seller. I bought in a solid school system because if I want to rent or sell it helps because people desire to live in "that area." If your looking to get into rentals and you know the school system isn't the best but the market is flooded with renters, than feel confident that you will do just fine. Most people who are renting in not the best area are doing so because they have to. You do limit yourself to future buyers though, those that are either 1. comfortable buying in an area where the school systems aren't great, or 2. investors who are really into rental properties.

0 Reply

John Semanchuk

Charleston, SC · Member since 2013 · 380 posts · 157 votes

7y

I just had clients who home school buy here (Mt Pleasant, SC). Even though they home school, they recognized that schools matter for the peer group that their kids will tap into for friends. They wanted to be in a good school district.

There are some buyers for whom good schools won't be much of a consideration but if they become your only market, you'll have a greatly reduced pool of buyers. By the law of supply and demand, that means you'll be getting less for your property.

3 Reply

Anna Buffkin

Investor · Pawleys Island, SC · Member since 2015 · 324 posts · 385 votes

7y

I own 10 properties, some in good school districts and some in not so good school districts; however, I have 1 house zoned for the best school in one of the best districts in the state. It's in an older neighborhood built before higher end homes built around it near the lake. As the vast majority of homes for the school are not affordable for a normal middle class family, it is never vacant and my phone rings off the hook when I do have a vacancy.

My current tenant has a special needs son. The district offers the most comprehensive program available for special needs children like her son. She had applied for an out of district waiver but was denied due to space. I have a vacancy in May. She came with security deposit and first month's rent in hand. With an in district address, the school could not deny her son the help he needed and my rental was one of the few properties available in her price range.

2 Reply

David BarnettPro Member

Rental Property Investor · Cambridge, MA · Member since 2016 · 634 posts · 415 votes

7y

I didn't see this point raised in the previous responses, and I do think that school district matters with a few caveats. If you are flipping properties, it certainly does matter, as it would open up the widest pool of buyers, including those with children that are school-aged. For rentals, I would say that it certainly does matter if your target demographic is for a rental pool that is likely to have families. The locations and properties that I invest in aren't popular with families, so I don't have to worry as much about school district. My properties generally appeal to roommate situations/young professionals that are 3-7 years out of school (college), without families.

0 Reply

Is BUYING in a GOOD SCHOOL DISTRICT even that important anymore?

Is BUYING in a GOOD SCHOOL DISTRICT even that important anymore?

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