The Impacts of Public Schools on Housing Prices of Residential Properties: A Case Study of Greater Sydney, Australia

Abstract

Residential property values are influenced by a combination of physical, socio-economic and neighbourhood factors. This study investigated the influence of public schools on residential property prices. Relatively few existing models have taken the spatial heterogeneity of different submarkets into account. To fill this gap, three types of valuation models were applied to sales data from both non-strata and strata properties, and how the proximity and quality of public schools have influenced the prices of different residential property types was examined. The findings demonstrate that an increase of one unit in the normalised NAPLAN score of primary and high schools will lead to a 3.9% and 1.4%, 2.7% and 2.8% rise in housing prices for non-strata and strata properties, respectively. It is also indicated that the application of geographically weighted regression (GWR) can better capture the varying effects of schools across space. Moreover, properties located in the catchment of high-scoring schools in northern Greater Sydney are consistently the most influenced by school quality, regardless of the property type. These findings contribute to a comprehensive understanding of the relationships between public schools and the various submarkets of Greater Sydney. This is valuable for the decision-making processes of home buyers, developers and policymakers.