Every study I have been able to find comes to the conclusion that good schools increase property values. Furthermore, for those of you like to analyze these things, they find the relation to be causation, not just correlation. In other words, it is not a coincidence, or it is not caused by the socio-economic background found in good school districts, but it is the good schools themselves that actually increase property values.
Here is an article from Columbia Business Times siting several studies on the subject:
"Several studies indicate that homeowners would experience a reduction of 2 to 10 percent of the value of their home should standardized test scores drop by 10 percent in public schools. Specifically, the Rand Corporation cites studies that have found that a 1 percent higher average reading or math score in Chicago and Massachusetts was associated with a 1 percent higher property value.
Other studies link the value of homes to the rating of the local school. Values for homes close to elementary and middle schools rated as good or excellent were 20 to 32 percent higher than similar homes located close to schools rated as average or poor. "
If that is not clear enough, that says that when LAUSD takes over the Hermosa Schools, property values will fall by a large amount. Hermosa Beach schools are currently excellent, the best in the state of California. And LAUSD is as bad as a school district can be. LAUSD is not average, it is poor or worse if there is a worse rating. Will Hermosa Beach home prices fall by 10% or 20% or 30% ? We will definitely find out if the Hermosa Beach School District is allowed to shut down.
Do you want to roll the dice just for fun to see if your property values fall by $100,000 or $250,000 or $400,000?
According to Zillow, the Median List Price of Single Family Homes in Hermosa Beach is a hair below $1.3 Million:
So, if home prices fall by only 10% after the handover to Los Angeles Unified School District, then the median list price for single family homes in Hermosa Beach should fall by a mere $130,000. But, if property values fall by 32% as the study says is possible, then the median list price will fall by $416,000 ! And that is for the median list price. Remember that half of the homes listed on the market are priced higher than the median by definition!
The house for sale at 2260 Circle Drive is listed for $3,549,000. This is not the most expensive home for sale in Hermosa Beach by a long shot. If this house at 2260 Circle Drive falls in price by 32% after the Hermosa Beach City School District is allowed to die for lack of money, the value of this one house will fall by $1,135,680.
In other words, the value of this one single house would fall by so much that if the school district had that amount it wouldn't be in financial trouble and wouldn't have to consider surrendering to LAUSD.
Hermosa Beach City Council
Peter Tucker Mayor peter@electpetertucker.com
Howard Fishman Mayor Pro Tempore kkfish@earthlink.net
Jeff Duclos Councilmember jeff@jeffduclos.com
Patrick "Kit" Bobko Councilmember kit.bobko@gmail.com
Michael DiVirgilio Councilmember mdivir@gmail.com
Councilmembers' phone number (310) 318-0216
Councilmembers' fax number (310) 372-6186
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