House buyers pay 2.6% more on average to live close to school

People are paying 2.6% more on average for a property near a secondary school compared to similar houses 1km away, a report from Daft.ie has found.

With the average home costing €215,000 in 2016, this works out as a price premium of nearly €5,600.

Moreover, a school’s record with students going on to higher education also impacts on house prices, the study found.

On average, buyers pay an extra 4.3% to live near schools where students send 80% or more of final-year students to college.

This is almost 10 times higher than the rate of 0.5% people pay to live near schools where less than 50% of students progress to higher education.

The report was carried out by Daft.ie with researchers at Trinity College Dublin.

Speaking about the report, assistant professor of economics at Trinity College Ronan Lyons said: “It puts numbers on the common-sense intuition that it costs more to buy a house with good access to schools.

“In other countries, this link between house prices and schools is the reason that property tax is used to fund schools. While that’s not the case yet in Ireland, this shows a different aspect of the benefits that occur from public investment in education.”

Varying rates apply for school proximity depending on homeowners’ location in the country, according to the report.

The largest premium for school proximity is 4.7%, for homes in Leinster, outside of Dublin. This compares to a rate of 1.6% in Dublin.

On average, people pay a premium of 2.5% for homes near secondary schools in Munster.

Buyers in Connacht-Ulster can expect to pay the lowest average premium to live near a school at 0.6%.

People can also expect to pay more for larger homes located near secondary schools.

Five-bedroom houses attract premiums of 2.4% compared to one or two bedroom properties, which receive an average premium of 1.3%.

However, property owners are paying less to live near a school than they were during the boom years.

In 2006 to 2008, buyers were paying on average €13,500 to live near schools.

The report also highlights a price difference of €400,000 for an average three-bedroom semi-detached house in South Co Dublin compared to a similar property in rural Munster or Connacht.

The Institute of Professional Auctioneers & Valuers (IPAV), says this show that Dublin is the economic engine of the country, to the detriment of much of the rest of the country.

IPAV chief executive Pat Davitt said: “The lack of acceptable broadband connectivity in many areas of the country is a real problem and it needs to be tackled very urgently because it is holding back development of the regions.”


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