School choice good for housing market

PDF: School choice report

Erasing school district lines and allowing students to attend any school they choose could be a boon for local Realtors.

When schools switch to open enrollment, the real estate values of typically lower-valued homes tends to increase, says a recent study by the National Center for the Study of Privatization in Education at Columbia University.

In fact, when given the choice to send their kids wherever they choose, parents are willing to snatch up property in low-cost neighborhoods near schools they perceive as "bad" because they can still send their children to a "good" school in a high-cost neighborhood where they may not be able to afford to live.

The equilibrium that results is higher values for homes in less-expensive neighborhoods -- between $3,000 and $6,000 per home the report says -- and lower values for those in more expensive neighborhoods, the researchers say.

"Our finding (is) that the adoption of an inter-district choice program causes income and housing values to rise in previously low-quality districts, (which) suggests that such programs may reduce residential income stratification and induce gentrification effects," the report states.

About one in four Hamilton County Schools are magnet schools, which allow some level of inter-district enrollment.

Even if the school system switched completely to open enrollment and real estate values increased around Brown Academy, located on East Eighth Street near the University of Tennessee at Chattanooga, nothing much would change at the school, principal Lea Ann Burk said.

More than half her students are magnet students, but most still live in the school's zone, she said. Their parents switched them to magnet status so that, even if zones changed, they could still attend Brown, she said.

But Hamilton County Board of Education member Rhonda Thurman, long a proponent of open enrollment, said not every parent wants to send their child to a magnet school.

Everyone should have the option to choose where they send their children, and it shouldn't have to be to a magnet school, she said.

She also believes the Chattanooga area real estate market would benefit from school choice.

"It would absolutely open the real estate value wide open. You would not be bound by the school where you had to buy a house," she said.

The Chattanooga area is no stranger to school zones' impact on real estate values. Hamilton County administrators now are considering a rezoning proposal for Normal Park Museum Magnet because the school's popularity has lured many young families to the area, and administrators say it is "bursting at the seams."

Along with some of his neighbors, Tim Price bought a home in the Hidden Harbor neighborhood in Hixson, partly because it was zoned for Soddy-Daisy High School. When school district officials rezoned the neighborhood in 2007 for Hixson High School, more than 200 residents signed a petition and sent it to the school board because they didn't consider Hixson to be as good a school.

"My house was appraised at $190,000 before, and $176,000 after. I lost $14,000 after the rezoning," Mr. Price said. "The reason I even considered Hidden Harbor was because of Soddy-Daisy (High School) and Loftis (Middle School)."

Randy Durham, president of the Chattanooga Association of Realtors, said it would be nice if potential homebuyers could purchase the house that best suited them, regardless of school zones.

"I think it would be a very good thing to see open enrollment," he said. "It would broaden a buyer's ability to look in other areas they might not look in otherwise."

Even if there is some benefit to increased home values, school board member Jeffrey Wilson said he still believes in neighborhood schools and would not support open enrollment.

"I think that you have some intrinsic benefit from children living in the same neighborhood. You have a better shot of engaging the community," he said.

Mr. Wilson said he doesn't think open enrollment would benefit as many students as some tend to think.

"I'm not sure that open enrollment favors the poor. There are still some issues for transportation," he said. "Maybe I'm eligible to attend a school across town, but it benefits the kids with resources."

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