Association for Public Policy Analysis & Management

While an extensive literature examines charter schools’ effects on achievement outcomes, less is known about the economic impact that these schools have on the communities in which they are located. The effect of charter schools on local property values can help reveal this economic impact. If homebuyers value access to charter schools, then demand for homes in locations that provide access to these schools will rise. Increased demand subsequently will raise the prices of the homes in the area. This research quantifies the economic impact of Georgia’s start-up charter schools on the property values in the communities in which they are located.

To assess the economic impact that charter schools have on local property values in Georgia, we compiled a rich data set that includes home sales from 2004 to 2013, covering 15 school districts that include 52 start-up charter schools. We analyzed the variation in sales prices of houses across school attendance zones, as well as the variation in house values based on the distance from the charter schools. In our analyses, we control for neighborhood and house characteristics.

Start-up charter schools affect property values through two different channels. First, property values could benefit from being closer to an amenity, the start-up charter school. Second, property values could benefit from being within the priority zone of a start-up charter school. Some charter schools utilize priority attendance zones within a larger attendance zone, which give enrollment priority to students who live within these zones. If both effects are present, we would expect magnitudes of the coefficients on priority zone charter school concentric ring distance variables to be larger than those for non-priority zoned start-up charter schools. Our results generally support the two effects listed above.

Most of this support comes from results obtained from analyzing subsamples of data from the metro-Atlanta area. We find that charter schools with priority enrollment zones in the city of Atlanta have a stronger effect on property values than charter schools without priority zones in the Atlanta suburbs. For instance, in the city of Atlanta, priority-zoned charter schools increased property values by 8.2 percent in the smallest concentric ring specification of 0.3 miles compared to 4.2 percent for non-priority charter schools in the smallest concentric ring specification of one-half mile in the Atlanta suburbs. For suburban Atlanta schools, the results also suggest that the presence of a start-up charter school can diminish the positive economic relationship between the quality of the zoned traditional public school and higher home values by offering an alternative to the zoned traditional public school. These results are consistent with the limited literature that has found that charter schools affect property values (see Patrick 2015).

Patrick, C. A. 2015, August 18. Willing to pay: Charter schools’ impact on Georgia property values. Atlanta: Georgia State University, Center for State and Local Finance.