School Choice Increases Property Values
April 3, 2014
A recent study concludes that school choice increases local property values, says Ashley Bateman of the Heartland Institute.
Looking at New York City, student performance increased with the expansion of charter schools. Not only did graduation rates rise, but net income and housing demand in those neighborhoods also increased.
- In all, the authors found that the opening of a new charter school led to a 3.7 percent increase in home prices in the same zip code, just a year later.
- From 2006 to 2012, graduation rates increased 11.3 percent, leading to a $37.1 billion increase in residential housing values.
- The addition of charter schools created more than $22 billion in housing value increases.
John Merrifield, senior fellow at the National Center for Policy Analysis, conducted a similar study of Edgewood, a San Antonio suburb, in 2009. When school choice was expanded, families and businesses flocked to the area. According to Merrifield, "One place's gain is another place's loss, so we can't use this in a macro sense, but so that districts compete. This is the shortcut to creating a wildfire of spreading school choice...without spending any more tax dollars."
Randall Reback, economics professor at Columbia University, said he expects to continue to see similar results from future research on this subject. "You would expect an even bigger increase from interdistrict choice because if you have two school districts you have direct competition. When you expand choice, not only does it increase the house values in places where people are interested in transferring outside of their districts, but can also increase the median income of residents. It can create residential integration as a result."
Source: Ashley Bateman, "Study: School Choice Increases Property Values," Heartlander, February 7, 2014. Robert J. Shapiro and Kevin A. Hassett, "The Economic Benefits of New York City's Public School Reforms, 2002-2013," Sonecon, December 2013.
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