How a public school performs directly impacts property values.
High quality public schools will attract parents, as well as grandparents who want to live near their grandchildren, to a community that has proven results. In turn, the local housing market reaps big benefits, which spill over into other economic development opportunities. Let me explain.
Between 2005 and 2009, new home construction in Nixa increased by almost $80 million. Granted, that was prior to the economic collapse, but it represented the largest four years ever in the school’s history: Enrollment increased by over 1,000 students (compared to the 2001-05 increase of just 252 students).
People were moving to the area for work. Where they were going to live was their choice. During this time, Nixa made some great academic strides and began heavily promoting those successes. The district implemented a strategic plan to move the district from good to great, and people were noticing.
Nixa’s 2015 demographic study by Business Information Services LLC sheds light on these connections. Nixa residents who commute to work leave home before 6:30 a.m., and about 9.5 percent of Nixa commuters travel more than 45 minutes. One could assume those who commute such a long distance would do so just so their children could be in the school district of their choice.
Nixa has been No. 1 in the Central Ozarks Conference of schools on standardized testing for the past 12 years. Let’s connect that to real estate: In 2000, the average home value was $97,269 and 14 years later it increased 176 percent to $171,290. Demand for a home in a good school means the cost of the supply can go up.
Nationally, the 2016 Schools and Housing Report by Attom Data Solutions found the average home value in a ZIP code with a good school was 77 percent higher than those without any good schools. Additionally, a 2010 study on the Nonlinear Effects of School Quality on House Prices in the Federal Reserve Bank of St. Louis Review found “houses associated with higher-quality schools command a much higher price premium.”
But those relocating often are looking at their home purchase as an investment. When considering a long-term investment and protection in housing downturns, and using the most recent one as an example, the Attom report also found “home prices in ZIP codes without good schools dropped more precipitously during the housing downturn.” The report also shows houses in areas with good schools “gained a 32 percent return on their investment” compared to 29 percent in areas with lower rated schools.
The district’s growth has leveled off the last few years because women of childbearing age are having less children and the population is aging. The 2010 census shows the population growth rate of those over 55 years old in the Nixa school district more than doubled the average rate statewide compared to 2000 levels.
What’s even more important is multiple studies have shown graduation rates have a direct relationship to crime. Those who don’t graduate “are more at risk of tangling with the criminal justice system, and are more likely to need social welfare assistance,” according to the Alliance for Excellence in Education’s report, “Dropouts, Diplomas, and Dollars: U.S. High Schools and the Nation’s Economy.”
When crime goes up or there is the perception of an unsafe area, housing prices drop. What’s one of the best ways to keep crime down? Good schools.
What do good schools do? Drive up property values.
Brenda Rantz is the executive director of finance and board treasurer for Nixa Public Schools. She can be reached at brendarantz@nixaschools.net.
