Anywhere you go, schools play a vital role in real estate value. Parents and future parents diligently research district maps and boundaries when shopping, and REALTORS® are regularly asked about local schools. I still remember being in 8th grade, and my own parents having endless “boring” discussions about school districts before our family made a big move. Graduation rates? School ratings? Transportation to the schools? Classroom sizes? The questions and concerns are endless as you find the right area for your family or planned family.
Some states, like North Carolina, have attempted to expand racial and economic diversity within schools by expanding district sizes and increasing magnet programs and bussing. This allows you to own a home virtually anywhere in the county and, theoretically, have your children attend any school with programs that suit your family’s interests and needs.
However, back in April, the News and Observer reported that North Carolina is considering dismembering their school diversity plans in two of its largest districts to make smaller and localized districts, with Wake County is being discussed in this plan. If Wake County were to carry out this division, there would be two to three separate districts within the county, based on location. This type of division poses huge potential losses or gains in home and property value.
According to an article posted on publicschoolreview.com, when the Wall Street Journal studied Florida real estate after the state implemented their school “grade” system, initially, there was about a $10,000 gap between similar homes placed near A rated schools vs. those near B rated schools. The article continues to point out that with more time on the graded system, the difference in home market value has increased to anywhere from 50,000-300,000 in value depending on the grades of neighborhood schools. That’s just the difference in costs, not the actual home cost.
So, what does this possible legislation mean for you? Do you buy or sell right now? Wait and see what North Carolina decides? Here are some things to consider:
- If you were looking in to moving to areas with near schools with higher ratings and grades, you may want to do that sooner rather than later. As trends show, it’s only a matter of time before those property prices exponentially increase.
- On the same token, if you have considered selling and live near any lower ranking schools, you may want to sell sooner rather than later, as property value could decrease and leave you feeling the loss in value and potential buyers.
- A lot still needs to happen before any division of the school district, and it may not happen at all. Either way, keep your eye on these bills, and act quickly and accordingly!
– By Kristen Stephenson, Urhous Contributor
Chen, Grace. “What is the Connection Between Home Values and School Performance?. Public School Review. 24 March 2017. https://www.publicschoolreview.com/blog/ what-is-the-connection-between-home-values-and-school-performance. Retrieved 28 May 2017.
Hui, T. Keung. “Break up Wake County schools? Bill looks at how to divide NC school districts”. The News & Observer. 12 April 2017. http://www.newsobserver.com/ news/politics-government/state-politics/article144213219.html . Retrieved 28 May 2017.