Is School District Important For Your Rental Properties

Is school district important for your rental properties?  That’s a good question.  It seems like by default, if you can get good cash flow in a good school district then it’s a no brainer. But what about those areas where the school district is not so hot?  Should you invest there?  What we have learned is the answer is ‘it depends’.  In our market, we’ve seen several school districts which are less than ideal the absolutely excellent for cash flow purposes. One thing you must keep in mind when purchasing rental properties is not everybody your going to rent to has kids.  As a matter of fact, the ones that don’t have kids tend to sometimes be better tenants simply because there are less people to create issues on the house.  Now I know what some of you that are more seasoned are thinking.  That’s true, until they have multiple adults they didn’t tell you about move into the house.

Well that’s true.  Fair enough.  However, we are speaking in terms of generalities for now.  Needless to say, as much as we love our children sometimes they essentially do create more work for cleaning up a property when we are in between tenants.  So as a result, it’s nice to rent to people that don’t have kids from time to time.  However kids notwithstanding, even if they do have children sometimes school district really does not matter a whole lot.  We have no shortage of excellent rental communities here in our market and many of them are in areas where the schools are really less than stellar, to put it mildly.  However, for rental properties they work absolutely great.

So, as you do your evaluations keep in mind that this may or may not be a good criteria to consider depending on what your goals are.  You should always look at the neighborhood that you are buying in and what kind of stuff is happening in those areas because that oftentimes is a much bigger telltale sign than the actual school district that it is a part of.  And while a school district that’s down in the rocks may not be the most desirable, sometimes the cash flow is simply too solid to ignore at the right price point.  On the flip side, you can have an excellent school system but have neighborhoods that are borderline if not war zone type neighborhoods that feed into it.  In our estimation, unless you are the most thick-skinned of investors we generally avoid such areas.  So, as you evaluate rental properties in the future, keep in mind while school district can be a significant play you could miss out some great opportunities if you give that factor too much weight.  It’s all about balance so often.  Happy investing!