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The impact of geographically defined school zones on house prices in New Zealand

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  • Michael Rehm
  • Olga Filippova

Abstract

Purpose - The purpose of this paper is to explore and quantify the impact of geographically defined school zones on house prices in New Zealand. Design/methodology/approach - This paper develops a series of hedonic pricing models to analyse 10,000 house sales transactions over a 21‐year period within a compact group of inner Auckland suburbs, which represents the epicentre of the school zoning debate in New Zealand. The study diverts from past research, which mainly focuses on school quality measures such as standardised test scores, and instead analyses the comprehensive price impacts of access to popular state schools. Its unique approach employs a geographic information system to divide the study area into effective school zones and then further subdivide into suburbs, thus offering a vital indicator of internal validity. Findings - The study's findings indicate that the influence of school zoning on house prices is not uniform and the variation in price effects is largely a function of the uncertainty of future zone boundary definitions. Although some “in‐zone” suburbs have enjoyed accelerated house price growth following the reintroduction of zoning in 2000, peripheral suburbs’ price premiums have diminished. Originality/value - In contrast to standard hedonic studies on school quality, this paper offers an innovative approach that integrates geography to solve what is essentially a spatial economic problem.

Suggested Citation

  • Michael Rehm & Olga Filippova, 2008. "The impact of geographically defined school zones on house prices in New Zealand," International Journal of Housing Markets and Analysis, Emerald Group Publishing Limited, vol. 1(4), pages 313-336, November.
    • Handle: RePEc:eme:ijhmap:v:1:y:2008:i:4:p:313-336
    DOI: 10.1108/17538270810908623
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    Citations

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    Cited by:

    1. Bade, David & Castillo, Jose Gabriel & Fernandez, Mario Andres & Aguilar-Bohorquez, Joseph, 2020. "The price premium of heritage in the housing market: evidence from Auckland, New Zealand," Land Use Policy, Elsevier, vol. 99(C).
    2. Emil Mendoza & Fabian Dunker & Marco Reale, 2023. "Changes in Risk Appreciation, and Short Memory of House Buyers When the Market is Hot, a Case Study of Christchurch, New Zealand," Papers 2307.13232, arXiv.org.
    3. Alexander W. Marré & Anil Rupasingha, 2020. "School quality and rural in‐migration: Can better rural schools attract new residents?," Journal of Regional Science, Wiley Blackwell, vol. 60(1), pages 156-173, January.
    4. Nguyen-Hoang, Phuong & Yinger, John, 2011. "The capitalization of school quality into house values: A review," Journal of Housing Economics, Elsevier, vol. 20(1), pages 30-48, March.
    5. David C. Maré & Andrew Coleman & Ruth Pinkerton, 2011. "Patterns of population location in Auckland," Working Papers 11_06, Motu Economic and Public Policy Research.

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