Photo: © Peopleimages / iStock
A school district's rating is an important consideration when buying a home, at least according to many real estate investors. Homes in top-rated school districts tend to cost more. As a result, buyers sometimes find themselves choosing between nice homes in low-rated school districts and underwhelming properties in better districts. The decision is important for parents who don't homeschool their kids, but what about prospective homeowners without children? For the childless homeowner, the quality of education in a particular district may appear to be irrelevant, but is it?
On paper, buying a home in a low-rated school district can get the buyer more home for less money. But many real estate experts will advise buyers to go for a more expensive home in a better school district for a couple of important reasons.
1. Holds Its Value. Homes in better school districts tend to keep their value, while homes located in average or low-rated school districts devalue the quickest.
2. Easier to Sell. A home in a top-rated school district is usually easier to sell, since it's more attractive to parents.
3. More Buyer Interest. Along with parents, investors often go after homes in good school districts. The result is that these homes get more views on real estate listing websites and sell faster.
If buying in a top-rated school district is beyond your budget, there are financial reasons to buy in a less-than-perfect school district.
School District Ratings Can Change
When a buyer is already paying a premium to be in a top-rated school district, there isn't always a significant potential for gain. Prospective buyers should also keep in mind that homes in good school districts can be risky. The home may only retain its value if the school district continues to be highly rated. If school ratings slip, so will the district's home values. In comparison, a home in a low-rated school district can see its value go up if the district gets a better rating.
Property Taxes Are Lower
Another reason to buy in a low-rated school district is the taxes. Property taxes tend to be considerably higher in good school districts.
While a school district's rating is certainly worth considering, there's much more to home value. For example, nearby amenities and local government can affect a home's resale price. For homebuyers with no plans to have children, those other factors may be more important than the school district.