Data shows NZ school zoning makes huge difference to house prices

Thursday, 3 August 2017

Houses in Takapuna Grammar's zone sell at a 60 per cent premium compared to those in the rest of Auckland.

Buyers must pay price premiums of up to 90 per cent to get into the best school zones, new data shows.

Homes.co.nz has revealed that good school zones add significantly to the price that houses command, in many cities around the country.

The biggest difference is for Epsom Girls' Grammar's zone in Auckland, which adds a premium of 90.5 per cent to local house prices.

This premium is calculated by comparing the median HomesEstimate within a school zone to the median HomesEstimate of the region as a whole.

READ MORE: School zones cripple buyers

Houses in Epsom Girls' Grammar's catchment zone commanded the largest price premium of any school zone in the country.

Glendowie College was also an asset to local prices, the real estate data website said, adding 64.43 per cent.

By comparison, sought-after Auckland Grammar only adds 41 per cent.

If school zones don't matter to you, you may be able to buy a better house by avoiding the most sought-after school areas.

Homes.co.nz data analyst Tom Lintern said that was due to the make-up of properties in its catchment area.

'The median HomesEstimate used in this analysis takes into accounts all property types, so the cheaper apartments in downtown Auckland drag down the premium for Auckland Grammar,' he said.

The impact of school zones varies around the country.

'The Auckland Grammar zone extends into the CBD including parts of Queen St where there are a large number of small, and relatively affordable, apartments, while the Epsom Girls Grammar zone only extends to Parnell. The real value is in properties that fall in both Grammar and EGGs zones.'

Outside Auckland, Rototuna Junior High School adds a premium of 43.75 per cent to prices, and Christchurch Boys' adds 35.85 per cent.

'Rototuna Junior High School's zone holds the most expensive real estate for a public school in Hamilton. There are a range of new builds in this area, along with riverside properties that drive median prices over 40 per cent above Hamilton's average,' said spokesman Jeremy O'Hanlon.

'Valuing a zone is a bit of a chicken and egg question. It's hard to say how much the quality of the school impacts price, versus the amenities and wider attraction of the area. What we can see is how much of a premium you'd have to pay if you're dead set on getting your children into a certain school.

'If school zone isn't on your shopping list, it's worth being aware of where the premium school zones are so you can avoid them. There's no point paying a premium for something you won't value.'

Bindi Norwell, chief executive of the Real Estate Institute, said in Auckland, prices in some sought-after school zones had increased more quickly than the city's prices a whole.

While Auckland's median price lifted 40 per cent over the past three years, Auckland Grammar zone prices were up 48 per cent, Mount Albert Grammar's were up 59 per cent, Rangitoto College's 42 per cent and Westlake Boys' 41 per cent.

'While it is hard to draw a parallel between the two, anecdotally our agents tell us that good school zones result in higher selling prices for properties 'in zone'. It is clear that the highly regarded Grammar zone has out-performed that of the overall region over the past few years.

'However, members tell us that location, proximity to the Auckland CBD and traffic flows are increasingly important in the purchasing decision process.

'Auckland's traffic has become so bad that buyers would rather pay a premium for location and send their children to private schools. We're hearing that some buyers won't consider being further east than Remuera, as the time it takes to travel to the city is too great. They're also prepared to sacrifice views for a quicker commute time,' Norwell said.

How much of a premium must you pay to be in zone?

Epsom Girls' Grammar - 90.52 per cent

Glendowie College - 63.43 per cent

Takapuna Grammar School - 61.29 per cent

Macleans College - 58.75 per cent

Selwyn College - 49 per cent

Rototuna Junior High School - 43.75 per cent

Rangitoto College - 41.55 per cent

Auckland Grammar 41.21 per cent

Westlake Girls' High School - 37.72 per cent

Albany Senior High School - 37.31 per cent

Christchurch Boys' High School - 35.85 per cent

Kaiapoi High School - 34.35 per cent