How Do School Districts Affect Home Value?
If you have ever wondered how much influence school zones have over the value of a home, then these survey statistics, recently published over at the Realtor.com blog, provide some insightful answers.
- 33% of prospective buyers would purchase a smaller home in order to secure a property in the right school district.
- 20% of prospective buyers would give up a bedroom or a garage for a better school district.
- 20% also said that they would pay as much as 10% above their budget in order to secure a property in the right school district.
- 10% said that they would pay as much as 20% above their budget for the right school district.
As you can see, school zoning is a very important factor for many homeowners — enough that it can compete with other value-determining factors such as square footage and the number of bedrooms.
Location-based indicators of value (such as districting) actually tend to be the best signals as to how your home will appreciate in value over time. This is because, in most cases, homes themselves do not actually appreciate in value — it is the land beneath them that becomes more expensive.
The older your home becomes, the more wear and tear it deals with. An older home is more likely to have substantial damage and/or outdated features. Even if you renovate and maintain your home diligently, older homes still boast less value than newer homes.
But property is almost always becoming more valuable. As Investopedia puts it, “the reason that land is an appreciating asset is a simple one. It is in limited supply, and no one is producing any more. The demand for land is constantly growing as the population increases, and since its supply is limited, its price must increase over time.”
So, unless some rare and unseen force causes your area to become less desirable, your property is always going to be rising in value. But, to state the obvious, not all properties appreciate at the same rate. Below are a few of the most important factors that determine how much a property will appreciate.
- Location within neighborhood. Even within the same neighborhood, some locations will always be more advantageous to appreciation than others. Homes located close to amenities tends to be more valuable, for example — as do homes located in cul-du-sacs and other more privacy-friendly locations.
- Future development. Public and private development of the surrounding area plays a big role in how a property will appreciate. A great school in the area can be a good harbinger of increasing demand. It is always wise to research government plans for development in the area, as these are generally a matter of public record. If you discover plans to increase public transit, built a school or hospital, or improve infrastructure, that may be a good sign that the area is set to grow.
- Supply. The broader housing market also plays a role in determining the value of your home. Areas that are already densely developed are likely to be a bit more stable, while areas with lots of undeveloped land could see an influx of new housing that increases supply and thus diminishes demand.
Are you planning on purchasing a home? Buying a home is one of the most important investments you will ever make. This is why considering all options matters. Visit Blue Marble Properties online today to view our full listings, in addition to more useful resources such as real estate articles, local info about the central Virginia housing market, and much more.