Monday, June 19, 2017

Housing Prices and School Districts



A recent article in The Newark (NJ) Star Ledger discussed the results of a study comparing home prices in certain neighborhoods with the ratings of the school districts in those neighborhoods. It is a given that many parents select where to live based on how highly rated the schools are.  Good schools attract families with school age children.  Parents are even willing to give up some housing options (like an extra room or garage) to live in an area with a more prestigious school system.  They are willing to pay thousands of dollars over budget to land a house in a well-regarded school system (high test cores, % of students who get into college). This raises the question of whether higher housing prices attract more affluent parents who want better education for their children or do schools with high academic ratings drive home prices higher.
One of the other issues to consider has to do with property taxes. In some states, the district’s taxpayers must approve local school board budgets. In districts with a high proportion of senior citizens, school budgets are often defeated as retirees on a fixed budget are reluctant to see their property taxes increased. In other areas, the local population wants the best for their children and is willing to pay for items like field trips, new technology, and experienced teachers. That is why you may find that local taxes may dedicate as much as 40% of their funding to run the schools.

These issues create a genuine dilemma for house-hunting families, especially those on a budget. It also points to the disparity in this country when it comes to public education. After decades of research and millions of dollars spent on trying to equalize education in America’s schools, the disparities still exist. As long as these issues persist, children in less affluent communities will continue to be shortchanged.


c. 2017 J. Margolis

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