Looking for a home can be tough, particularly if you’re looking for an area that has respectable schools. Due to high demand, areas that are in sought after school districts can easily run low on available housing and be priced high when the buyer finds one. According to a recent study by HomeUnion Research Services, even if the buyer doesn’t have children, a knowledgeable buyer will look in areas that have highly-ranked public schools, therefore building long-term equity.
This tactic is backed up by the National Bureau of Economic Research (NBER) that said, based on changes in property values from 1980 to 1990, due to fluctuations in state aid for schools, every $1 increase in per pupil state aid results in a $20 increase in housing value. According to HomeUnion, who Cited NBER, the study goes on to claim that, “additional school expenditures may benefit everyone in the community, whether or not those residents actually have children in the local public school system.”
By analyzing neighborhoods with the top-rated schools and affordable homes, HomeUnion compiled a list of ZIP codes that will likely have property value increases faster than other homes in their metro.
“It’s our hope that this information will assist homebuyers, who are either looking to invest remotely or raise a family in their home, in finding the highest values for their properties,” explains Steve Hovland, Director of Research for HomeUnion.
In the top five, coming in first, Kansas City, Missouri has a median home price of $159,700 and school quality ranking of 88.5. Following in its lead, Oklahoma City, Oklahoma ($165,000/89.6), St. Louis, Missouri ($167,000/81.1), Palm Beach, Florida ($167,500/87.9), and Chicago, Illinois (168,000/81.9).
A cluster of California areas brought up the rear of the top 30 areas, starting with San Francisco, California in spot 30 ($1,035,000/86.9), San Jose, California ($799,000/80.5), Oakland, California ($625,000/94.8), Orange County, California ($579,000/88.6), and Fort Lauderdale, Florida in spot 25 (567,100/93.3).
To see the full list, click here.