How much more do home buyers pay for better schools?

Matthew Zalaznick's picture
Tuesday, October 8, 2013

It's a key question for many home buyers who have or plan to have young children: We want a house in an area with good schools, but what price premium — if any — will we have to pay?

Academic research generally has found that, all other factors being held equal, you pay somewhat more for houses in highly rated school districts compared with homes in neighborhoods where the schools have lower ratings and test results.

Now a national realty brokerage, Redfin, has come out with a study that purports to put hard numbers on the pricing differential. Using a huge database of about 407,000 home sales and nearly 11,000 elementary school districts in 57 metropolitan markets, the study concluded that, on average, buyers pay $50 more per square foot for homes in top-rated school districts compared with homes served by average-rated schools.

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