This is how much difference does a school zone makes to property values

Being located in a school catchment area can make a massive difference to a property’s value.

Clearly some people are prepared to pay a significant premium according to new REIV data which shows that homes located within the catchment area for some of Melbourne’s best public primary and secondary schools are fetching over $400,000 compared to those outside the zone.

School ZoneNow there’s nothing new about this.

And it’s much the same in Sydney and Brisbane where education influences home buyers across a broad range of demographics who consider school catchment zones when determining suburbs of interest.

And it’s much the same for property investors  who are looking to attract long term, quality tenants.

REIV President Robyn Waters said houses within some school catchment areas are hot property because access to sought-after public schools is one of the major factors that buyers with school-aged children consider when hunting for a new home.

“The median house price for a residence within the designated neighbourhood boundary for the newly opened Beaumaris Secondary College is $1.62 million while the median for a house within a one kilometre radius of the zone has a median of $1.21 million — $412,500 less,” Ms Waters said.

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“Meanwhile homes bordering the school zone for South Yarra Primary School have a median of $1.37m which is $335,000 less than the $1.7 million median for a house within the school zone.

“From the REIV’s latest data, it appears that addresses within coveted designated neighbourhood boundaries for public primary schools have become more desirable than high school zones. Location within a well-regarded public primary school zone is important for increasing numbers of parents who plan to send their children to a public primary school followed by a private secondary college.”

Ms Waters said homes within the catchment areas of popular schools are tightly held.

“Parents are weighing up the cost savings of sending their children to a good public school rather than spending thousands on fees at a private school,” Ms Waters said.

School Zones“Most of these schools require proof of residency such as a Council rates notice, utility bills and/or driver’s licence, a statutory declaration of residence, or a minimum leasing arrangement of 12-months from a Licensed Real Estate Agent and many only offer school tours for families who live within the designated zone.

Median price differentials of more than $100,000 from within and outside school zones have been found around schools in Beaumaris, Glen Waverley, Kew, McKinnon, Mount Waverley, Camberwell, South Yarra, Malvern East, Malvern, Hampton, Preston, Fitzroy, Hawthorn East, Altona and East Bentleigh.”

Here’s the data

Secondary schools – 2+bedroom houses
12 months to 31 December 2018

In school zone Bordering school zone 1km
School Dec-18 Median Number of sales Dec-18 Median Number of Sales Difference
BEAUMARIS SECONDARY COLLEGE $1,622,500 222 $1,210,000 143 $412,500
GLEN WAVERLEY SECONDARY COLLEGE $1,621,000 116 $1,300,000 241 $321,000
KEW HIGH SCHOOL $2,001,000 344 $1,715,000 344 $286,000
MCKINNON SECONDARY COLLEGE $1,548,000 121 $1,390,500 320 $157,500
MOUNT WAVERLEY HIGH SCHOOL $1,310,000 361 $1,173,000 286 $137,000
CAMBERWELL HIGH SCHOOL $2,100,000 387 $1,980,000 491 $120,000
BOX HILL HIGH SCHOOL $1,285,750 214 $1,200,000 332 $85,750
FRANKSTON HIGH SCHOOL $770,550 290 $690,000 214 $80,550
UNIVERSITY HIGH SCHOOL $1,395,000 135 $1,327,500 190 $67,500
BALWYN HIGH SCHOOL $1,900,000 290 $1,980,000 247 -$80,000

Primary schools – 2+ bedroom houses
12 months to 31 December 2018

In school zone Bordering school zone 1km
School Dec-18 Median Number of sales Dec-18 Median Number of Sales Difference
SOUTH YARRA PRIMARY SCHOOL $1,700,000 87 $1,365,000 188 $335,000
LLOYD STREET PRIMARY SCHOOL $1,980,000 113 $1,757,500 196 $222,500
HAMPTON PRIMARY SCHOOL $2,050,000 77 $1,855,000 231 $195,000
MALVERN CENTRAL SCHOOL $2,400,000 113 $2,230,000 251 $170,000
MOUNT WAVERLEY PRIMARY SCHOOL $1,407,950 72 $1,266,000 171 $141,950
PRESTON WEST PRIMARY SCHOOL $1,060,000 45 $920,000 227 $140,000
FITZROY PRIMARY SCHOOL $1,435,000 66 $1,305,000 211 $130,000
AUBURN SOUTH PRIMARY SCHOOL $2,230,000 59 $2,100,000 201 $130,000
ALTONA PRIMARY SCHOOL $952,500 38 $830,000 75 $122,500
VALKSTONE PRIMARY SCHOOL $1,468,000 59 $1,355,000 251 $113,000


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About

Kate Forbes is a National Director Property Strategy at Metropole. She has 15 years of investment experience in financial markets in two continents, is qualified in multiple disciplines and is also a chartered financial analyst (CFA).
Visit www.MelbourneBuyersAgent.com.au


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