A community (real estate) development professional in Philadelphia notes, that the steadiest indicator of whether a family will move out of her stable and popular neighborhood, is the year their child must enter fifth grade.
In the 1990's the (in)famous School District Superintendent David Hornbeck tried to get the Philadelphia School district to shut down the city's magnet schools: he thought the schools segregated the brightest children from the peers which meant that students in neglected schools never had bright peers to learn from and with. He was unable to do this because it is popularly believed that doing so would have driven the last of the middle-class out of the city. I myself went to a magnet school and I am not sure what my parents would have done, not being able to afford a private school, had they not had one (Masterman) to send me to, other than move out of the city. The link between housing values and school districts is one that is well established in the literature. Of course you probably know that, if you yourself (or your parents)have not moved into a suburban school district because of the better schools, you know plenty of people who have.
While it is well known that we are willing to "vote with our feet" and buy more expensive houses and pay more expensive taxes to make sure our kids have access to better schools, a new report published by the Wharton School suggests that we are underfunding our schools, not only in terms of what it takes to make sure they have adequate funding, but in terms of what we are actually willing to pay for them.
The study examined the general obligation bonds that California voters agreed to float to finance school facility investment. These bonds meant that tax payers were required to pay higher real estate taxes in order to build more and better schools. As the authors note
"We find that passage of a bond measure causes house prices in the district to rise by about six percent. This effect appears gradually over the two or three years following the election and persists for at least a decade. Our preferred estimates indicate that marginal homebuyers are willing to pay, via higher purchase prices and expected future property taxes, $1.50 or more for an additional dollar of school facility spending, and even our most conservative estimates indicate a willingness to pay of $1.13."
This investment in schools is critical. Nearly 100,000 of our public schools are in need of renovation, expansion and repair. As the study notes "A third of public schools rely on portable or temporary classrooms and a quarter report that environmental factors, such as air conditioning and lighting, are “moderate” or “major” obstacles to instruction." One can only imagine what the statistics are for large urban school districts such as Philadelphia. According to the historian George Thomas, quite a few of Philadelphia's schools, designed during the 1920's were built by architects known more for designing prisons than schools.
However, as education policy analyst Claire Robertson-Kraft, editor of A Grand Bargain for Education Reform notes, the educational increases measured in the study "are pretty marginal compared to other academic interventions, like teacher quality." Which naturally leads to the question, could the Alhambra Unified School District spend the $85,000,000 in its bond issue on teachers instead. However not only does that amount to only $1,000 per student, but there are significant legal and policy constraints on spending bond revenues on operations.
What this points to is a mismatch in how we fund our education, Californians (and by extension probably most of us) are willing to pay more, and we have to finally fess up and start paying more for our education. It certainly pays us back, not only in housing values, but in our own future.