Pricey property in sought-after school zones
Homes in some of the country’s most soughtafter school zones are likely to experience more price growth than others in the same city, even in a softer market.
Research from Homes.co.nz has revealed the most expensive school zones in the country.
Epsom Girls’ Grammar in Auckland is in first place. It has a school zone with median house values of $1.8 million. It was followed by Glendowie College, where properties were worth a median $1.6m and Takapuna Grammar, with a median school zone value of $1.44m.
Outside Auckland, Wellington
Girls’ College was in the top spot, with a median school zone house value of $850,000.
Mike Jones, an economist at ASB, said there was often a marked difference in price between properties within a school zone and outside it.
But he said the effect could be blurred because desirable schools were often in desirable areas anyway, which meant they had relatively high house prices.
Prices might rise faster in sought-after school zones, though, he said.
When there was strong population growth and few listings, there would be extra competition for homes in those areas that families wanted to be in.
Bindi Norwell, chief executive of the Real Estate Institute, agreed school zones were a big driver of purchasing decisions.
‘‘Beyond specifics about the house, one of the most common questions real estate agents get asked is ‘what school zone is the house in?’ as this is something that is extremely important to a number of families.
‘‘This is particularly true in areas where purchasing on the ‘wrong’ side of the street means you’re not in your preferred school zone or where one street away can be the difference between being ‘in zone’ or ‘out of zone’.’’
Homes.co.nz showed that ‘‘double Grammar’’ zone houses in Auckland – both Auckland Grammar and Epsom Girls’ Grammar – had the highest median value. There, properties were worth a median $1.83m, about twice the general Auckland median, Homes.co.nz data showed.
But data scientist Tom Lintern said another option was to buy a cheap apartment in the area.
Leasehold options are still selling for less than $300,000.
A one-bedroom unit in Cowie St, Parnell, sold for $250,500 in July. Another three-bedroom in Manukau Rd, Epsom sold for $265,000 in April.
Lintern said families could live in a leasehold apartment until the child was established in school, then move on. If the property was bought early in the lease period it would be easier to resell.
Jones said whether it would be a good fit would depend on a family’s circumstances.
‘‘REINZ has highlighted the benefits of apartment living for families looking to get into particular school zones when a standalone property might be out of their price range,’’ Norwell said.
But she said it would require an extra level of due diligence to understand the type of leasehold being considered.
Some leasehold properties require ground rent to be paid each year but others are prepaid over a longer-term.
‘‘Buyers would also need to know how much they would have to pay and how that could increase over time.
‘‘Our recommendation is that people undertake thorough due diligence when it comes to purchasing a property including the obvious things such as talking to a lawyer, understanding whether they can afford the repayments, is the home a leaky building, understanding the neighbourhood or undertaking a building inspection.’’