Private Schools and Their Adverse Effects on Property Values

Many parents want the academic benefits of private schools.

Private schools offer a higher quality of academics and discipline, and a safer environment than many public schools. How a community chooses to educate their children, however, can affect seemingly unrelated things, such as property values.

Home Values and Schools

Couples looking to buy a home often wish to do so in neighborhoods with good schools. They are likely to bid higher to secure a home in a district offering quality education. Higher home values mean more money to the public schools per student.

Dollars Per Student

Every seat filled in a public school means "x" number of dollars to the school. That means that when neighborhood children are sent to private schools, the public schools receive less money.

Taxes

Homeowners pay property taxes that benefit public schools whether they send children there or not. Homeowners periodically vote on taxes and school budgets. Some people who pay for private educations for their children vote "no" on increased public school spending, which deteriorates the quality of public schools.

Quality

In neighborhoods where homeowners choose not to support public education by passing school budgets, the quality of the area public schools decrease. As a result, home values decrease because the district is perceived as having bad schools.

Expert Insight

It is a rather vicious cycle. As school quality declines, so do home values. As home values decline, so do the tax dollars that go toward public schools. In neighborhoods, these two qualities spiral up or down together. Flight to quality private education is only one factor in the relationship between education and home values.

References

• Effect on Property Values
• Property Values Drop, So Does Revenue (scroll down)
• Schools Brace for Bad Year as Home Values Fall

Resources

• Blog