Top realtors say, Education, Education, Education

You would expect real estate experts to tell you it’s all about “location, location, location.” But this afternoon, a new report had them focusing on “education, education, education.

While underfunding schools negatively affects student achievement and curtails their college and career prospects, underfunding also depresses property values throughout Pennsylvania, according to a new report by ReadyNation.

The report, Real Estate Markets Thrive When PA Schools Work, was released at a panel discussion co-hosted by PCCY which included state lawmakers Rep. Tina Davis, Rep. Leanne Krueger, and Sen. Tim Kearney, and Ridley District Superintendent Lee Ann Wentzel, and realtors at Ridley High School, Delaware County.

Steve Doster, State Director for ReadyNation, kicked off the discussion by saying “providing greater long-term state education funding through the Fair Funding Formula will improve student performance in these districts and help seed a much-needed upward trend for many Pennsylvania real estate markets.”

Jacob Rosch, Senior Policy Analyst for the Reinvestment Fund, said the research he did for the report showed that both improving student proficiency and reducing the number of students in the lowest school performance categories was associated with higher average home prices in subsequent years, but that the latter yields greater returns.

If Ridley, for example, had the funds to increase student achievement by just 5%, the District would see an additional $2.1M in property taxes without a property tax increase.

“In Pennsylvania, such an improvement could boost home values enough to generate over $519,000 per year in new property tax revenues,” Rosch said.

Realtor Erica Deuschle a top seller with Berkshire Hathaway HomeServices, Fox & Roach Realtor cautioned about the downward spiral that can result in a community when schools underperform, suppressing property values and local tax generation.

“What has resulted is a scenario where struggling communities are forced to raise property taxes for schools that remain underperforming. This is a deadly combination for a real estate market,” Deuschle said.

The report stresses that unfortunately, too many Pennsylvania schools have inadequate funding to ensure student success. In fact, the Commonwealth’s per pupil funding gap between poor and wealthy districts is the widest in the nation with Pennsylvania’s wealthiest districts outspending poor districts by 33.5 percent, a spending gap considerably higher than the national average of 15.6 percent. This causes the quality of public schools to vary dramatically from community to community.

Compounding this problem is Pennsylvania’s over-reliance on local property taxes to fund public education and the limitations this has placed on poorer communities to adequately fund their schools.

According to the report, on average, states across the country cover 47 percent of school funding costs, but Pennsylvania’s state contribution to education funding is less than 37 percent, ranking the Commonwealth 47th in the nation.

State Rep Tina Davis (Bucks County) and member of the Realtors Caucus, commented that while she was once a proponent of the statewide efforts to eliminate property taxes, she is no longer.

“I am persuaded by this report and have changed my position,” said Davis. “I’m fully onboard. My position is that we must increase state funding for schools.”

READ Real Estate Markets Thrive When PA Schools Work