As a San Francisco homeowner or a potential home buyer, you probably already know that having a home near a desirable school can increase a home’s value. Any realtor will tell you that if you have children who will attend school, then you would be wise to consider schools and districts in your research.
In fact, the National Association of Realtors found that 26 percent of homebuyers are influenced by the quality of their school district when selecting a neighborhood for their next home.
When agents say location matters, being near those top schools or districts can make a big difference in a home’s selling price and property value as an investment. With shifts from cities like San Francisco to suburbs, and housing markets in flux in the wake of the pandemic, understanding how schools affect property values can help you stay informed about the value of a home you want to buy, or the one you are living in. School enrollment might influence the value of your home now or in the future and you can have the tools to research the trends and ask for your realtor’s insights.
School enrollment can equal property value increases
There are many features that make a school desirable and thereby increase property values for nearby homes, and one of those factors is school enrollment. The pandemic led to enrollment shifts in San Francisco, and the San Francisco Unified School District saw a 10% enrollment drop between 2000 and 2019, according to EdSource. Does that mean this enrollment drop led property values to decrease? Not necessarily. However, paying attention to enrollment can help you gauge if a school district may be desirable or not. The National Association of Realtors also reported that counties with the highest increase in public school enrollment for primary and secondary grades over a seven-year period equaled a 33 percent increase in home prices. An unusual enrollment change may not influence property values, but a consistent change could. San Francisco home prices did fluctuate during and after the pandemic, with school enrollment also changing.
Better school funding can mean higher property values
Many factors go into a San Francisco school’s ranking on a site like GreatSchools, and from a general overview, the higher the ranking of nearby schools, the higher a property’s value. Better school funding can also lead to a higher ranking. With school funding tied to local taxes and property taxes, better schools will come along with higher-valued homes. Higher value homes can mean better funding and better funding can increase a school’s ranking. It’s a complex relationship but often you can expect those neighborhoods with top schools to be in greater demand. Lower property value school districts may not offer the same quality of educational resources as a higher property value district.
GreatSchools ratings can help you see desirable areas
With the complexity of determining a school’s rating, it can be confusing to try and consider all of the data and to get an overall picture of where the top schools are and where home values and school rankings might align with the home of your dreams. The nonprofit organization GreatSchools has done the job for you to make it easy to see how a school district is ranked and to then see if you might expect a higher property value as compared to a nearby school with a lower rating. The organization collects data from 51 state departments of education and the federal government to make it easier to crunch the numbers. By looking at the data, you can see how lower-ranked schools tend to be in neighborhoods with lower property values, and higher-ranked schools in neighborhoods with higher property values — but there may be exceptions. Beyond a grade from 1-10, the ranking will also include rankings for test scores, academic progress, equity, and demographics for students and teachers, all as compared to the state average. GreatSchools will also give you a picture of the school attendance zone, to see which neighborhoods fall into a certain school’s attendance range. These scores can even be part of the data presented while selling a home.
Consider other areas for feeder schools
When looking at how property value can be affected by a school district, school attendance zones can help you determine how to find a home in your budget with a top school. For example, a home within walking distance to a top school might be valued more than a home that falls in that school’s zone, but is reachable by transportation. That’s why you may want to consider schools and districts before setting your targeted neighborhood for your dream home. Part of a home’s marketing plan can include the schools included in the zone to attract would-be buyers who are parents. You may also want to research if a new school will be added to a certain neighborhood as that may lead to property value increases in the future. Private schools may also come into play, and it can be wise to consult with your real estate agent if you are considering a home close to a private school to see how the property value might change.
When it comes to property values, there’s no doubt that location matters whether we are talking about schools, walkability, or access to amenities like shopping and entertainment. For homeowners who care about schools, access to great schools is likely one of the most important areas to research.
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