Why one school zone can be 12% better than another
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Why one school zone can be 12% better than another

By Sasha Karen
School

Investors can look at an area’s economy to gauge how profitable a new purchase may be, but one property investment consultancy has another metric that can reliably show the difference for a 12 per cent rise in selling price: school zones.

Relying on a state or territory’s economy is a good basis, but when suggesting investment advice, Shaun Strickland of Momentum Wealth says there are other metrics available that can help refine the viability of future profitability.

“We don’t want to just rely on the economy to drive property growth. We also want to look at other aspects, it can really, really push that 1 or 2 per cent per year,” Mr Strickland said in a webinar.

One additional metric is to look at the closeness of a property to employment centres and demographic trends of “professionals” moving into the area.

“We’re going to try and get people that are going to spend more money on their house, theyre going to look after their lawns, theyre going to increase the streetscapes, theyre going to develop, theyre going to expand their houses,” he explained.

Waterfront property is always seen as a luxury, which is another factor Mr Strickland said can raise the price of a property.

Using the example of PerthPerth, TAS Perth, WA, location near the Swan River and the ocean are big drivers for property, according to Mr Strickland.

“You look at the most expensive properties in Perth, and it’s Mosman Park and Peppermint Grove, and Cottesloe, and they’re all on the water,” he said.

School zones in particular have proven a recent development in determining a selling price, Mr Strickland said, with the example of Willetton Senior High School and its location in the Bull Creek suburb.

“Within that area, it is split with being in the Willetton Senior High School zone and the Leeming Senior High School zone. Pretty much a 50/50 split,” Mr Strickland said.

“These are both inner city suburbs, probably about 8 kilometres from Perth CBD in your classic medium to upper-class area. And what we saw was that the properties that were in the Willetton Senior High School zone transacted for an extra 12 per cent more than the area that was in the Leeming High School zone, and we’re talking one street apart, and we’re talking a homogenous product your classic 4x2 family house.

“By monitoring school zones, you can get a good inclination of future capital growth, because if that’s constantly going to grow at being 12 per cent greater, you’re going to get more bang for your buck.”

In addition to existing school zones, new school zones should also be on the radar of investors.

“Just recently, about three months ago, the WA state government announced a new school being developed within Subiaco, so we’ve got to put that into the whole calculation of future capital growth and what that will mean for properties nearby,” Mr Strickland said.

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Why one school zone can be 12% better than another
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