Schools Are a Big Home Selling Point in Montco and Other Tidbits
Is back to school season really just a few weeks away? Unbelievable. What might be more believable, however, are the numbers crunched in a new report by real estate website Trulia, which sought to find where schools are a major selling point in home sales, where they’re less so, and whether there’s something to mentioning schools in a listing for a higher listing price. Take a seat and jot some notes, Properteers!
Using data from the 100 largest U.S. metros, gathered between June 2014 and June 2015, Trulia Chief Economist Selma Hepp writes Montgomery County mentions schools in 22.5 percent of its home listings, bringing the Greater Philadelphia suburb to no. 3 on its list of “Where Schools Are a Big Selling Point.”It should be noted, though, the Montco ranking includes data from neighboring Bucks County and Chester County.
Montgomery County was just behind Orange County and San Jose, Ca., which have 28 and 25 percent of their listings mention schools, respectively. Meanwhile, schools as a selling point was less common in places like Las Vegas, NV (.7 percent); Cincinnati, OH (2.8 percent); Nashville, TN (3.4 percent); and Pittsburgh, PA (4.4 percent).
Next, Hepp examined housing markets that, in addition to mentioning the word “school,” use a positive adjective (like “top,” “ranked” “rated,” and “excellent,” among others) to describe nearby educational institutions. In this part of the study, only 1 percent of homes for sale disclosed being near a “good” school. “More frequently though, in 10% of listings nationwide, schools are mentioned in the description, without necessarily a positive attribute,” reports Hepp.
Among those markets with the most number of listings mentioning positively described schools are Orange County, San Jose, Ventura County, and Oakland. In the Greater Philadelphia Area, the sole market to be included on this list was Camden, NJ.
Does this mean parents should all move across the river to get a house near a good school? Nah. In fact, as Hepp points out, “good” schools tend to be brought up in listings that are located in areas where local school quality ranges from great to awful. It serves to assure potential buyers that their children are likely to get a good education.
Moreover, there’s the question of who the would-be buyers are. Some buyers in certain markets might be more concerned about other neighborhood amenities, but less concerned about schools. “For example, schools are rarely mentioned is Las Vegas, which generally attracts more retirees and international buyers than parents with school-aged kids,” says Hepp.
Finally, the answer to the question we all know you’ve been wondering about: does being near a good school impact home prices? The answer to this is a resounding, “it’s complicated.” From Trulia:
The answer to this question is not straightforward. Home prices in great school districts are generally higher, however higher prices may be a result of higher-income residents living in those districts. The connection is hard to detangle and the causality is blurred. Are schools better because of the higher tax base, or did the higher income households move to the areas because of better schools? This answer is still debated among experts.
What we found in our analysis is that mentioning the word “school” in a for-sale home’s listing description does not consistently add to the price of a home or detract from it. Other neighborhood characteristics may be more important in explaining the variation in prices.
That being said, among those top three housing markets that mention “schools” the most in their listings (Orange County, San Jose, and Montgomery-Bucks-Chester County), including info about a home’s proximity to schools did add a little more to the listing price. In our tri-county metro that increase was by 7 percent.
Hepp’s takeaway? “It pays to brag about your local school district if it really is a great, excellent, distinguished, award-winning, or highly-rated school.”