As if you needed more reason to steer your clients toward homes in good school districts: A new study says that homes in a zip code with at least one good elementary school have home values 77 percent higher than the average home in districts without at any good schools nearby.
ATTOM Data Solutions analyzed 2015 average test scores and compared them to 2016 home price values and home appreciation in its 2016 Schools and Housing Report.
The average home value in a zip code with a good school was approximately $427,400, while in a zip without one, it’s $241,100, according to the study. Perhaps more importantly, homes appreciate at a much faster rate in good school zips. The average home value gain is $74,700 compared to $23,300 at zips without a good school. That’s a difference of more than $51,000 since purchase.
Of course, if math classes taught us anything, it’s important to note that the large difference in dollars is at least partially attributable to the higher values of the homes overall. So ATTOM calculated the ROI, and homes near good schools see a return on investment of 32 percent, about 4.5 percent higher than those without a good school.
So what qualifies as a â€œgood school?â€ The property data company defines one as a school whose state Department of Education test scores are at least one-third above the state average.
Daren Blomquist, senior vice president at ATTOM Data Solutions, says that buying in a zip without a good school can offer plenty of benefits to homeowner, but it’s much less dependable price growth over time.
â€œWhile good schools are one of the top items on most homebuyer checklists because of the quality-of-life benefit they provide, this report shows that high-performing schools also come with a financial benefit for homeowners in most markets â€” at least over the long term,â€ he says. â€œMeanwhile, home prices in zip codes without any good schools tend to be more volatile, which might work to a homeowner’s financial benefit in the short term but not over the long term of at least 10 years.â€
ATTOM analyzed 19,000 schools is 4,400 zip codes with 45 million homes to produce the data.