School Ratings Impact Home Values: 2020 Update
A lot of things matter when it comes to the final sale price of a home – its size, location, age, even energy efficiency. But one major influence we’ve seen emerging in the real estate market over recent years is school ratings. In 2020, home buyers and sellers alike need to be aware of how the schools near their home are rated, and how that rating can affect home values both now and in the future.
Why School Ratings, Why Now?
As real estate agents, we have to know and respond to market forces, even as we try to combat misconceptions about what makes a school, home or neighborhood desirable or undesirable. It’s difficult in the case of schools because some of the factors that can really make a difference to students are not quantifiable. It’s the dedication of teachers and staff, the quality of the administration, and the way the community supports the school. Some schools that don’t “rate” well may actually be great schools.
Still, school ratings can give us some useful information that translates pretty directly to student performance: Classroom size, graduation rates, and yes, even test scores. It’s still not fair that a homeowner could see a drop in value in 2020 because a nearby school performs poorly. However, depending on where the home is located in Portland, it could happen.
The primary reason school ratings impact home prices now, more than before, is simply due to the internet and the availability of, and the depth of, information at a local level. Anyone can now instantly find all kinds of data on every public school in the country.
Reports on School Ratings Changing Home Values
As home buyers turn to online school performance ratings more frequently, real estate agents and research groups are paying attention to how this impacts their decisions. Read the below carefully, it’s amazing! Here are some of the most relevant recent statistics:
- The New York Times reported in 2017 that “a 5 percent improvement in test scores can raise prices by 2.5 percent” in suburban neighborhoods.
- A realtor.com economist, looking at 2016 home prices and school district boundaries, found that “in most markets, families are willing to pay more for a highly ranked school than an extra bedroom, a shorter commute, and even big home features such as a swimming pool [or] higher ceilings.”
- The same study also found that homes sold faster in the top 20 school districts nationwide (rated by GreatSchools). In fact, homes in these districts spent one-third less time on the market than other homes in the same county.
Where to Find School Information and Data for Portland Schools
Browsing listings online is an easy way to shop for homes. Getting information about schools is just as easy. Here’s a quick guide:
- Look up the address on portlandmaps.com. The information panel that comes up will have a “schools” tab showing the district and the assigned public elementary, middle and high school for that home.
- Read the school’s Report Card. Look up schools by name on the Oregon Department of Education website (it’s free).
- Check on the GreatSchools rating, which provides a quick look at a school’s performance based on the most recent test scores (the score may already be featured on the real estate listing, but it doesn’t hurt to double-check for accuracy).
- Talk to a top 1% buyers’ agent. We want you to find the best school for your kids, and we have the local insight to help you in your search.
- Finally, check out our recent blog post on the Top 3 Portland Neighborhoods with Highly Rated Schools in the Portland area.