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School Quality will increase House prices

The school ranking published this weekend is the first after the approval of the new regulation, which prevents tutors and pupils from having different tax addresses. In this report, Colliers approaches this issue for the first time and forecasts the impact of this new regulation on house prices, especially in the larger cities.

The correlation between school quality and house prices is one of the most studied themes in real estate. In Portugal, despite the existing regulation, the lack of control, effectively, allowed parents to choose the preferred school, despite their home address.

The approval of Despacho Normativo 6/2018 may very well correct the admission issues, but the consequences will not be felt straight away. Moving home is always a slow process, which coupled with the importance of private schools, especially in high school, will smooth and prolong in time, the impact of this regulation.

However, once control becomes more effective, house prices near the best public schools will increase, copying other cities, like London or Paris, where houses near the best schools may very well have a 10% premium, increasing the price of a 250.000 euros apartment to 275.000 euros.