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Every real estate agent knows what surveys and studies confirm: The quality of public schools influences where people buy a home and what they pay for it. Regardless of whether they have children, buyers care about the reputation of the schools because they know that schools directly affect a community’s vitality as well as its property values. “The demand for homes is simply greater in neighborhoods with high quality public schools, and higher demand translates into higher home prices,” says REALTOR® Chris Wilson of Laurel, Mississippi. According to Wilson, it’s no surprise that when prospective homebuyers are interested in a house one of their first questions is, “How are the schools?” Every REALTOR® has been there. “And the reason is obvious,” he says. “People want the best schools for their children, or they want a home in a neighborhood with high demand for resale purposes.”
School quality depends on a variety of factors, some of which are addressed in this toolkit. The most basic definition of a quality school is one that provides a clean, safe environment with up-to-date facilities and equipment--an environment that is conducive to learning and brings out the best in both teachers and students. Such schools enhance the overall quality of life, strengthen communities, and attract new life to the neighborhoods that surround them. Quality schools require public involvement--including the involvement of REALTORS®. “It makes sense for REALTORS® to familiarize themselves with issues that affect local schools and to take steps to improve the quality of public schools,” says Wilson. “Because better schools benefit students, neighborhoods, and REALTORS®.”
Public Schools and Property Values
While studies confirm the link between real estate values and school quality, it’s difficult to “disentangle the value of school quality from other neighborhood amenities,” as Thomas J. Kane and his colleagues note in a 2005 paper on the subject. Nonetheless, empirical studies have attempted to tease out the specifics of the relationship between home values and school quality. One widely cited 1997 study by UCLA economist Sandra E. Black removed variations in neighborhoods, taxes, and school spending to isolate the value parents place on school quality. According to her calculations, parents are willing to pay 2.5 percent more for housing for a 5 percent increase in test scores. David M. Brasington, while at Tulane University, explored the impact on housing market values of a variety of measures of school quality. He found proficiency tests, expenditure per pupil, and pupil-to-teacher ratio to be “consistently capitalized” into housing prices, while measures such as graduation rates, teacher experience levels, and teacher education levels are not consistently positively related to housing prices.
Without splitting hairs over precisely what school attributes relate most directly to housing prices, it’s safe to say that there is a relationship between schools and property values--and that schools play an important role in many residential housing decisions. Based on the 2011 National Association of REALTORS® (NAR) Community Preference Survey, school quality was among the four top community-related factors influencing homebuyer decisions. In fact, 75 percent of those surveyed cited high quality public schools as either very important or somewhat important in their decision-making process. Says Mike Theo, senior vice president for legal and public affairs for the Wisconsin REALTORS® Association, “The ripple effects between public education and housing necessitates that the real estate community take a direct interest in improving America’s primary and secondary schools.”
Public Schools: A Toolkit for REALTORS®
NAR has produced this toolkit to help REALTORS® enhance their knowledge and understanding of the public school system so they can become involved in improving their schools and communities. The opening section of the toolkit--Issues in Public Education--is designed to provide insights into current debates related to public education and emerging trends that are reshaping the nation’s public schools. These articles focus on topics such as the following:
- Federal education policy, school funding systems, and the persistent gap in performance between some groups of children and between states, school districts, and schools.
- Building and siting new schools--and preserving old ones--in ways that conserve resources and enhance walkability.
- Federal, state, and local programs that enable teachers to live near the schools where they work and programs that are making it possible for more kids to walk and bike to school.
Section two of the toolkit--REALTORS® Making A Difference--shares examples of REALTORS® and REALTOR® associations around the country that are playing an active role in engaging local students and improving local schools by serving on school boards, volunteering at local schools, donating their time to community-wide efforts to improve schools, and advocating for local school-related initiatives. REALTOR® associations and affiliated foundations donate thousands of dollars each year to fund local scholarships and school-centered projects. They spearhead special projects, support local teachers, and supply much-needed efforts and funds to school-based projects and programs. These REALTORS® and REALTOR® associations are making a real difference in their schools and communities--and serve as guides for those interested in implementing similar projects and programs in other communities.
Finally, all of the articles in the toolkit include NAR tools and web-based resources that can help REALTORS® learn more and implement programs that support public schools.
Addressing the Issues
Whether it means mentoring a local student or advocating for a local ballot initiative supporting schools, engaging is a step worth taking. For one thing, REALTORS® bring a unique set of insights to the table. For example, in Reno/Sparks, Nevada, REALTORS® Daryl Drake and Kris Layman are of the members of the Council for Excellence in Education, a group of business leaders committed to improving K-12 education and to addressing public perceptions of local schools. They also serve on the legislative committee of the Reno/Sparks Association of REALTORS®. “We bring the REALTOR® perspective to the Council for Excellence in Education,” says Drake. “And, on occasion, we bring issues to the REALTOR® legislative committee.” REALTORS® have a vested interest in improving schools. “I would encourage REALTORS® to get involved,” says REALTOR® Donald G. Warner, who has played a leadership role on the school board in Upper Moreland Township, Pennsylvania, for many years. “The school board needs to know how the decisions made in the school affect the real estate market in the area.” These efforts--and this toolkit--are all about strengthening schools and communities and building the relationship between REALTORS® and the communities they serve.