The Future of Home Equity Values in Columbia, SC? Look to the Schools

By Richard Barrington
Local Lender Columnist
Dec 22, 2008
With home equity values under pressure and mortgage companies becoming extremely selective about making loans, home buyers need to be ever more conscious of choosing the right location. One indicator of the long-term social and economic health of an area could be the performance of its schools. For Columbia, SC, looking at the 26 high schools which serve the area could well provide potential home owners with a clue as to where to focus their home searches.

Schools and Home Equity

An area's schools can impact long-term home equity values for a few reasons. First of all, current performance of schools often represents the investments those areas have already made in education. Areas which have been economically stable are likely to see this reflected in school performance. In turn, schools with the highest graduation rates and best levels of student achievement are producing the best qualified employees for the next generation of business--people who are well-positioned to contribute to the continuing economic success of the area.

The positive influence on home equity values can have a self-perpetuating effect. Homeowners in those areas are most likely to qualify for home improvement loans, because stable values give mortgage companies more confidence. Those home improvement loans represent a reinvestment in area housing, which gives further support to home equity values, and the cycle continues.

Naturally, school districting is an important issue for home buyers who have, or are planning to have, children. In addition, the correlation between school district quality and long-term socio-economic health of an area makes it a factor for all home shoppers.

Columbia Area Schools

Schools, then, are an important link in the chain that keeps home equity values stable and gives mortgage companies the confidence to lend. So, to assess how this factor plays into the Columbia area, consider the performance of its 26 high schools -- both the top performers overall, and the up-and-comers.

According to the school report card for 2007 by the South Carolina Department of Education, three Columbia-area high schools received the top rating of "excellent" for overall performance: Lexington, Chapin, and Dutch Fork. Prospective home buyers might be especially interested in properties served by these schools.

Also worthy of notice were five high schools that received an excellent rating for improvement. These schools were Columbia, Dreher, Eau Claire, AC Flora, and the CA Johnson Preparatory Academy. Strong school improvement may be reflective of the type of up-and-coming area that can represent the best value for home buyers.

These ratings are just a snapshot, but they can help start an informed conversation about area schools. For the schools with excellent overall ratings, it would be worth looking into how long they've maintained that level of achievement. For schools showing strong improvement, it would be good to know whether this was from a low starting point. Ultimately, knowing about area schools can provide some insight into the future of an area's real estate and your home equity.

Sources:

• South Carolina Department of Education
• Gardener Guides

About the Author
Richard Barrington is a freelance writer and novelist who previously spent over twenty years as an investment industry executive.