Schools and Real Estate
By Charles TurnerWe’re down here in Marin this week. It is where I grew up so there is a certain affinity to it. It has changed but is still the same. Property prices are still crazy and the house listed for $1.095M down the street sold for $1.2M. At the same time the 6 o’clock news reports over 100,000 houses in default since January in the Bay Area. A comment in a past post pointed out that Marin may not be the best indicator of the Bay Area as a whole but I do find the following interesting.
My mom had marked an article in Marin Magazine: Tim Porter’s Four R’s (Reading, ‘Riting, ‘Rithmetic & Real Estate). He places much of the property value in southern Marin’s school system. A private school starts at $20,000 a year in the Bay Area and if you can put your kid into a public school that rates as high as the private schools.
Does it apply to Portland’s high price neighborhoods? Dunthorpe and the Riverdale school system come immediately to mind. Ainsworth and Chapman Elementary are in high dollar neighborhoods and are always highly rated.
Rob Lee, executive vice president of California Mortgage Advisors in San Rafael, crunches the numbers: a family who spends $20,000 a year on private school tuition could use that $1,600 a month to finance an additional $240,000 home loan. At $30,000 in tuition, the mortgage capacity grows by $400,000.
Because buying more houses is more important than providing for their children’s future.
Wow, just….wow….and….wow.
……
This is the mortgage business looking at themselves in the mirror on the morning after a hard night of drinking too much of their own Kool-Aid.
All faith in their business is now suspended.
No way. Schools barely matter here. Sorry, Portland’s a great place but it’s Doonsberry rep is due to its own aparthy.
Granted, people won’t pay millions for a house without good schools. But the O recently noted that when given the option of paying $6,000 to tranfer in to Lake O schools, only 27 families did (many so that their kids could go to the same schools as their friends in the same neighborhood). Schools treat transfers differently
Take that option to any suburb of New York City and you’ll see lotteries and waiting lists. Or the article the Times did run about the increase in college educated people living in trailer parks to get access to quality schools. Trailer-Park Sales Leave Residents With Single-Wides and Few Options
Does it apply to Portland’s high price neighborhoods? Dunthorpe and the Riverdale school system come immediately to mind.
I think that would be confusing cause and effect. Riverdale has a good rep because the folks that live around there have the cash to make it so. I doubt there are a significant number of Dunthorpe dwellers who moved there for the schools. I’ll bet a lot of Dunthorpe dwellers still send their kids to fancy private schools.
As far as Portland in general goes: It would seem that most families with kids are moving out of Portland and into the ‘burbs – at least that’s the impression I get. Portland is trying to attract “The Creative Class” 20-somethings who don’t have kids.
Chapman Elementary – I love it!
Actually, I did a comparison of real estate values by school district in the Austin, TX area. There was a high correlation between higher real estate values and better schools.
Actually, I did a comparison of real estate values by school district in the Austin, TX area. There was a high correlation between higher real estate values and better schools.
I’m sure there is. No doubt about it. But is it a cause or an effect?
Schools definitely determine house values in my opinion. Buyers will pay more for Lake Oswego Schools. The Mt. Park area is a good example of this. That neighborhood is part Portland Schools and part Lake Oswego schools. The houses with Lake Oswego Schools have a higher value.
I’d have to respectfully disagree with the last comment. For example, look at Aquinas Street in Mountain Park. It is one street that has some homes in Portland schools and others in Lake Oswego schools. Comparable homes on that street are of comparable worth regardless of school district. There enough buyers who desire the location and neighborhood alone so that schools do not create a quantifiable impact on value.
Schools matter. We purchased a small home in the Ainsworth Elementary neighborhood mainly for the school even though we could have afforded much more house in other Portland neighborhoods.