Do school catchment zones effect property prices
For families with school-age children, buying a home is often about finding a property in a neighbourhood which guarantees a place at a local top performing high school.
Families are often willing to pay a premium to live within the right catchment zone if it means their children are automatically admitted to a top public high school.
So just how much extra does it cost to live within a catchment zone and is such a purchase a good investment?
What is a catchment zone?
Public schooling is generally based on the educational needs of children who live locally. Each school has a catchment zone, that is the geographical area which defines where students need to live in order to be guaranteed admission.
The boundaries of these designated neighbourhoods can and do change regularly, and for some high-performing institutions these zones have been shrinking over the years.
In some cases individual streets can be cut in half, meaning it can come down to house number or side of the road
Many families are willing to pay a premium to live within the right school catchment zone.
Often schools ask parents to provide documentation showing where the student and/or guardian lives and many won’t accept applications from those moving into the area. Some schools may require that the child or guardian has lived in the area for a set period of time.
In some areas, top public schools with excellent results tend to select students based on an individual’s performance in entrance exams or tests, so catchments zones can be less of an issue.
What effect does a catchment zone have on price?
Social researcher Mark McCrindle,from McCrindle Research, says the rising cost of private education has led to parents targeting certain areas in order to have their child admitted to a top-performing public high school.
“Because of the rising cost of private schools and because these are generally good government schools in good areas, parents buying homes are prepared to factor in the costs they would otherwise be saving on what they would have spent on an independent school and they are adding that (cost) to the purchasing power of their place,” he says.
Senior Buyers Advocate from National Property Buyers Rob Di Vita says houses within a school catchment zone can be up to $50,000-$100,000 more expensive than surrounding areas.
“What tends to happen is when owner-occupiers are buying in those zones, they tend to be a bit more emotional and pay a premium to get in,” he says.
Be prepared to invest for the long term. Picture: Getty Images
While the catchment zone effect can vary from between an extra 5-20% when it comes to price, the premium families are willing to pay often depends on the school’s academic record.
Simon de Crespigny from Macartney Real Estate, a boutique agency in Sydney’s Chatwood, has seen many cases of buyers walking away from homes if they don’t fall in to the catchment area of their choice. “In our core selling area of Chatswood, being in the Chatswood Public School zone, falling outside the zone of choice can effect home prices by $100,000 or more” he says. “A lot of our buyers come from the South side of Sydney and want their parents or grand parents to be able to walk their children to and from school”.
While school catchment zones aren’t the only factor affecting house prices in these areas, the reputations of these institutions can sway buyers with school-aged children.
Is buying within a catchment zone a good investment?
As properties in school catchment zones tend to be located in sought after inner-city areas, Di Vita says he recommends clients buy within school catchment zones, provided they don’t pay too big a premium.
“If their (the buyers’) view is to hang onto it for 10-15 years, based on historical growth patterns the property will perform and they will make their money, generally speaking, if they are buying in the right area,” he says.
One or two streets can make a difference as to whether you’re in or out of a catchment area.
Simon Pressley, Managing Director at Propertyology, says investors should recognise that not all buyers are swayed by catchment zones.
“It’s worth keeping in mind though that this is not a one size fits all thing; it’s not like everyone living within a particular part of town has school-aged children and or wants them to go to that one school,” he says.
“Catchment zones are one of those subjective things which are important to some people and not important to others. When searching for investment properties, Propertyology places more priority on considerations like affordability, proximity to employment, dwelling styles, future housing supply, and rental return.”