Schools & the Homebuying Decision

Quick Takeaways

Buyers can research schools using websites such as

GreatSchools.org
SchoolDigger.com
RateMyProfessors.com

Source: What to Do When Buyers Ask About Schools (NC REALTORS®, 2023)

Area school quality can influence not only the value of a home, but also the buyers’ decision. According to NAR’s Profile of Home Buyers and Sellers, more than half of home buyers with children in the home under the age of 18 years said that the quality of school districts is an important factor when purchasing a home. However, as a REALTOR®, providing school quality information can be a minefield of fair housing pitfalls and steering.

Be aware of resources you can provide your clients so they can educate themselves on area school quality. There are numerous authoritative internet sources offering data on schools and school districts from national as well as state and local sources that your clients can turn to independently.

School spending has been proven to increase home values. A study done by the National Bureau of Economic Research found that home values increased $20 for every one dollar spent on public schools in a community.

See References for more information.

References

NAR Library & Archives has already done the research for you. References (formerly Field Guides) offer links to articles, eBooks, websites, statistics, and more to provide a comprehensive overview of perspectives. EBSCO articles (E) are available only to NAR members and require the member's nar.realtor login.

Schools and the Home Buying Decision

Help Clients Get an Objective View of Local Schools (REALTOR® Magazine, Apr. 3, 2023)

“You can’t offer an opinion about school quality, but you can point customers toward data, resources and the right people to talk to about their concerns.”

How to Handle Client Questions About Schools and Neighborhoods (REALTOR® Magazine, Jan. 3, 2023)

“To avoid inadvertently steering clients in one direction over another, real estate professionals can also offer resources—objective data from school board websites, for example”

What to Consider When Buying a Home Near a School—Do Your Homework! (realtor.com®, Jan. 21, 2020)

Pros and cons to think about when considering buying near a school.

What to do if Schools are Important in Your Home Search Handoutpdf (Texas REALTORS®, Jun. 18, 2019)

"How often do clients ask you about whether a property is located in a good school district? Fair housing laws prohibit you from steering clients, whether toward a particular area or away from that area, based upon the buyer’s race, color, religion, gender, disability, familial status, or national origin. That means you likely avoid giving opinions on school districts, because a comment could be construed as influencing clients’ housing choice based on demographic information.

So, although you may not be able to give your clients a direct answer to their question, there are resources you can share so buyers can make an informed decision without your input. Share this consumer handout from Texas REALTOR® magazine that explains how buyers can do their own research into schools."

2019 Moving with Kids Report (National Association of REALTORS®, 2019)

Fifty-three percent of buyers with children in the home under the age of 18 years said the quality of the school districts is an important factor when purchasing a home and 50% said convenience to schools.

Impact of Schools on Property Values

How To Choose the Right Real Estate Location (the balance, May 22, 2022)

“One study by economists and analysts at the Federal Reserve Bank of St. Louis found that "the price premium parents must pay to buy a house in an area associated with a better school increases as school quality increases."”

What is the Connection Between Home Values and School Performance? (Public School Review, Apr. 26, 2021)

“According to the National Bureau of Economic Research, there is a definite correlation between school expenditures and home values in any given neighborhood. A report titled, “Using Market Valuation to Assess Public School Spending,” found that for every dollar spent on public schools in a community, home values increased $20. These findings indicate that additional school expenditures may benefit everyone in the community, whether or not those residents actually have children in the local public school system.”

Effect of Distance to Schooling on Home Prices (Review of Regional Studies, Jan. 1, 2015) E

Results indicate that as distance to schooling increases, home price decreases. Despite the overall inverse relationship, the study finds a congestion effect near all levels of schooling; homes 1,000 feet from a school have a higher price than homes less than 500 feet. In addition, results suggest that homes just inside the cutoff distance for walking to elementary school (1,320 feet) are priced lower than homes just outside this cutoff.

School Quality Information on the Web

There are numerous sources on the Web offering data on schools and school districts. The reports they provide vary in detail and cost, but almost always have useful information for home buyers and REALTORS®. Many states and local areas also make their school district information available online. Websites of the state departments of education are a good start, along with those of local newspapers. The following are a few sample websites:

National Center for Education Statistics

Publishes information on all levels of education, from preschool to graduate school.

State and local sources

Many states and local areas also make their school district info available online. Websites of the state departments of education are a good start, along with those of local newspapers. For example:

GreatSchools: Your community resource to find and share information about schools.
Neighborhood Scout: Receive patented school ratings and other data.
Private School Review: Learn about private schools, find schools, get admissions tips, and financial aid help.
Project Appleseed: The national campaign for public school improvement.
School Digger: Ranks schools on a 5-star system, and also shows rankings by test scores.

eBooks & Other Resources

eBooks.realtor.org

The following eBooks and digital audiobooks are available to NAR members:

Community Builders: A Tale of Neighborhood Mobilization in Two Cities (eBook)

Community by Design: New Urbanism for Suburbs and Small Communities (eBook)

Community Conversations: Mobilizing the Ideas, Skills, and Passion of Community Organizations, Governments, Businesses, and People (eBook)

Defending Community: The Struggle for Alternative Redevelopment in Cedar-Riverside (eBook)

In The Neighborhood: The Search for Community on an American Street, One Sleepover at a Time (eBook)

Love Your Neighborhood (eBook)

Neighbors & Neighborhoods (Audiobook, eBook)

The Pocket Idiot’s Guide to Home Buying Checklists (eBook)

Tips & Traps When Buying a Home (Audiobook, eBook)

Have an idea for a real estate topic? Send us your suggestions.

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