Increase your property value by investing in local schools

School district ratings directly affect neighborhood property value

The quality of a local school district is extremely important for renters or homebuyers with children. For example, wealthy Chinese investors have been buying homes in high ranking school districts of Seattle, WA. These Chinese buyers are paying very high prices to secure the future for their children and grandchildren.

Many of the foreign buyers are making real estate purchases remotely. They do not even care about looking at the quality of the houses in person. There are remote bidding wars for properties in eastern Seattle purely based upon the statistics of the school districts. To these families, they value the education of their children over every other factor.

In 2013 a survey found that 91 percent of home seekers valued local education as one of the most deciding factors. Children attend schools that are within their zip code, so location is very important.

In the survey, they found out that one in three buyers would buy a smaller home for the same price if it was located near a good school. Twenty percent of the survey takers also said that they would pay ten percent more for a house close to the school district. Even ten percent of them would pay twenty percent more based on the education quality.

It is no secret that more wealthy homeowners live in nicer school districts. Even if you look at raw statistics, homes will generally sell at higher prices in prestigious districts, even if the house itself lacks physical qualities. Real estate is very limited in certain areas, so when there is high demand it drives up prices and the need for construction.

For instance, we donated over $100,000 into a run down school district within the neighborhood of Good Haven in Dallas, Texas. The funding has provided education improvements in areas like science and school supplies. We also have plans for $250,000 in improvements for the near future. With real improvement made to the schools, school ratings go up and neighborhoods attract families looking for an affordable place to live with good schools. The property values have been sharply increasing and rental properties are almost all occupied. Prior to these investments, the properties were very low priced, old and neglected for years.

Many investors in Dallas, including myself, believe that there will be a ripple effect of investment in poor neighborhoods and schools. This is one solution to resolve poverty in neighborhoods while improving education in districts that need the help.

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Ruel M. Hamilton is the CEO and founder of Dallas-based AmeriSouth Realty , a real estate investment company that specializes in the ownership, development and acquisition of multi-family projects within the affordable housing industry. He primarily owns and operates Class C multi-family apartment communities, including some that were developed using Low Income Housing Tax Credits (LIHTCs). Hamilton believes that keeping and maintaining older properties is the key to fixing the affordable housing crisis. Accordingly, he pays close attention to bringing aged, crime ridden or poverty stricken housing back to life with rehabilitation and revitalization.