School Districts and Value of Homes

Buying a home in the Bay Area, all you ever here about is how you *must* buy in a good school district. All this concern about how school test scores affect the property value of your home. It's pretty easy to see the areas with good schools - they have the shacks that sell for more than they are worth. How do you measure the value of school districts? You can rely on hearsay and rumors about how this school is good and that school is not so good.

Or you can goto GreatSchools.net and search for the school district you are interested in. Each public school has what is called an API (Academic Performance Indicator) score. It ranges from 0-1000. 1000 is the best. For example, Piedmont High School has an API of about 900+ (excellent). Lamorinda schools (Miramonte, Acalanes, Campolindo high schools) have API scores in the high 800's to low 900's. Again very good. Schools like El Cerrito High School and Richmond High School have API scores in the low 500's - which isn't so hot.

So clearly, if you have kids and want them to attend school in a safer, more educationally-focused environment, it is probably best to live in a good school district. But do those API scores justify the extra $100-$200K premiums homes in those areas fetch? After all, just because your kid goes to a school with a high API score doesn't mean that he/she is going to get in to Harvard or Stanford. In fact, attending an academically competitive school could even be a hindrance to your child if he/she isn't the brightest. How upset would you be if your son/daughter attended a high API school only to drop out and never graduate? He/she probably could have done that at a lower API school. After all, there is always the top 10% of a class and the bottom 10% of the class. Always.

The other option for those not living in the 'promised' school districts is private school. Private schools have varying tuitions, some in the range of $23,000 per year. Depending on how poor the schools in your area are, maybe you have to shell out tuition for 12 years or just 4 years (high school only). Pay for the house now or pay for the tuition later... What to do?

Either way, if you have kids and aspire for them to achieve great things (no guarantees), you will be shelling out money. Tuition, high home prices, it never ends. Is it worth the extra money to live in a good school district? Maybe. That price is different for each individual. Apparently there are many people who do think it is worth it - see the ridiculous home prices for certain areas.