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Buying in a good school district: Is it worth the price?

When house hunting, most people with children look at school ratings and even plan where they live based on those ratings. According to this article, California renters pay up to 46% more near top schools. 46% more! Then I read this article from OC Housing News and wondered if school ratings are really everything. Take a look and tell me what you think!

Source: OC Housing News

Do school ratings reflect the quality of education that warrants high real estate values?

School ratings reflect where concerned parents move with their children, not the quality of education a school provides.

Parents want to provide their children with every advantage in life. Those students with the best education generally enjoy higher wages and greater life achievement than students from school districts with low achievement scores. Parents react to inequities of our education system by shunning poor performing districts in favor of higher rated ones. Thus real estate values are higher close to better schools.

Many parents shopping for a house obsess over the school ratings. They aren’t chasing the ratings because of abstract correlations to a better life. Parents seek out these schools because they believe the quality of education is higher and the higher quality of education is what will make their child succeed. However, school ratings may not signal that the quality of education is any better.

School ratings are largely based on standardized test scores, probably the best method because it compares all schools to the same benchmark. However, school ratings often have less to do with the quality of the teachers than it does with the quality of the parenting. The more parents value education, the better their children score on standardized tests.

The activities of these parents make school ratings self-reinforcing. Once a school district obtains a high rating, it attracts other parents who greatly value education, so they bring in their children who will also score well. High ratings beget high ratings and low ratings beget low ratings as parents who value education shun poor performing districts.

School ratings only change significantly if the demographics of the school change. For example, poor performing school districts in the path of residential development generally see a significant improvement in test scores once all the high wage earners move in to new houses in the area. One example in Orange County is San Clemente. In the early 00s, the schools in San Clemente were about average, but when new developments at Talega and Marblehead added a large number of high wage earners, the school achievement scores went up considerably.

Were the improved test scores at San Clemente High due to a sudden improvement in the quality of education, or was it due to the sudden influx of new families concerned about education?

Does recognizing this fact change how you look at school ratings?