Families are spending thousands — and in some cases, over a million dollars — to buy homes within the catchment zones of top-performing public high schools, according to new research.
But the analysis by property data firm Cotality also suggests that paying more upfront does not necessarily mean greater long-term price growth.
The report looked at house prices in nine popular school catchment zones across Sydney and Melbourne.
In seven of those zones, homes inside the catchment were more expensive than similar homes nearby but outside the boundary.
However, six of those catchments recorded weaker capital growth over the past 15 years.
Eliza Owen, head of residential research at Cotality, said the results confirm what many buyers already suspect, that popular school zones often come with a hefty housing premium.
"These premiums may reflect the value placed on getting into top public schools, but it could also reflect an array of other factors like proximity to train stations, or the high incomes of those living inside the catchment area," she said.
The economics of catchment area homes
Homes in the combined catchments of Killara High, Willoughby Girls and Lindfield Learning Village in Sydney's North Shore held a median value of nearly $1.3 million higher than homes nearby but outside the catchment.
Despite this, houses in the catchment recorded lower long-term growth of 126 per cent over the past 15 years, compared to 150 per cent in neighbouring areas.
In Melbourne, the premium for homes in the catchments of Princes Hill and University High School reached $357,000.
Capital growth was again weaker than that of the surrounding suburbs, with in-catchment homes growing by 82.6 per cent over 15 years, compared to 106 per cent in nearby areas.
Owen said as affordability has worsened in many good school catchment areas, this may have contributed to a spill-over in demand outside of the zones, leading to lower total capital growth.
"In many cases, that means the premium has trended lower over time," she said.
Not all school zone homes cost more
The report also found areas where homes inside a high-performing catchment were actually cheaper than those outside.
Houses in Sydney's Cherrybrook Technology High School catchment were $155,000 lower than those outside the boundary in the same suburbs.
In Melbourne, houses in the Doncaster Secondary College catchment were $48,000 lower than those outside the zone.
"For many families, buying into a strong public school zone may still be a more affordable alternative to private education," a statement from Cotality said.
According to Futurity Investment Group, the average cost of 13 years of private education in Australia was estimated at $349,000 in 2022, with significantly higher costs in Sydney and Melbourne.
"In six of the nine regions we analysed, the house price premium within public school zones was at least 100,000 dollars," Owen said.
"While that’s a significant upfront cost, it could end up saving families money when compared to paying for private schooling over many years."
