Worst house in the best catchment – how to invest in school zones

School catchments and what they mean for you

A school catchment is the geographical area surrounding a state school. You can use the MySchool website to find out details of specific state school catchment areas.

Schools that appear on the map as flagged in red are ‘enrolment managed’. That means that a School Management Enrolment Plan (SMEP) has been put into place because the school has reached more than 80 per cent capacity. The effect of a SMEP is that there are significant restrictions in place that reduce the discretion of the school principal to accept out-of-catchment students. The school catchment rules are geared towards ensuring that there are sufficient school places for the students residing in that catchment, so they won’t miss out on a place at their nearest school. Whilst you can still apply to enrol at a school even if you live outside the catchment, it’s a longshot. You’ll be put on a waiting list and there’s no guarantee of acceptance.

In Brisbane, the most in-demand state schools subject to a SMEP include:

• Indooroopilly State School
• Ironside State School (St Lucia)
• Bardon State School
• Ascot State School
• Brisbane State High School, and
• Eagle Junction State High School

However, SMEPs are far more common than you’d think.

How schools police the catchment rules

As a rule, schools will request that you provide evidence your child lives in the relevant catchment before they’ll proceed to enrol them. The in-catchment residence must be your child’s primary place of residence. Whilst the requirements differ from school to school, proof of residence usually means providing

• rates notices
• mortgage
• utilities bills, or
• a copy of the rental agreement

Schools have cottoned on to attempts to get around the catchment rules. Proceed with great caution where your local school requires parents to have lived in the catchment for a minimum period prior to the enrolment attempt.

Check with your local school so you know in advance what they do and don’t accept when it comes to proof of residence. Join forces with a real estate agent who’s familiar with the catchment rules and the specific points of proof required by the local schools. That way you’ll market the property to the right tenants.

How you can use school catchment zone rules in your favour when investing

Chances are you’ll pay a hefty premium when you buy in the catchment area for a great state school. Some estimates are up to 56.5 per cent. So, does this make for a wise investment, or should it be a case of ‘back to the drawing board’?

The good news is, you’ll also attract a higher rental return, which means more money in your pocket sooner. You’ll also be less susceptible to vacancy because of increased demand for properties in the area. Capital growth’s another factor to consider when making the decision whether to take the plunge and buy into a catchment area.

There’s a few golden rules to remember when investing in the school zone

Once in, always in? Don’t get bitten by re-zoning!

Just because your investment property is within the catchment at one point in time, it doesn’t guarantee that it will be for all time. As apartments spring up and housing density increases around these schools, there’s a flow-on effect in with boundaries contracting. School catchment boundaries are reviewed regularly and rezoning does occur. If in doubt, avoid buying close to a boundary so you don’t get left out in the cold if the catchment is re-zoned.

Don’t buy a dump if you can avoid it

The biggest trap you can fall for is landing yourself with a money pit, albeit in the right catchment. The worse the condition of a property, the more time, effort and money you’re going to have to spent turning it into something vaguely habitable. That translates to time wasted with the property sitting vacant when you could be making money.

It makes sense to get a thorough property inspection done by a reputable building inspector who can make sure that there are no structural issues or pest infestation that’ll blow out your budget and your time frame. It’s also the best way to protect yourself from legal liability by exposing defects that might get you sued later on.

Look for properties with a quick, cosmetic fix that you can turn around in a matter of a few weeks, not months. Keep in mind that the kitchen and bathroom are the two rooms that are most likely to be a turn-off for potential tenants, so focus your energies there.

Cover yourself against subletting

Unfortunately, the most in-demand school catchments tend to be proximate to other things that are attractive to short-stay tenants (think Airbnb). You want complete control over who’s staying in your investment property. Get some legal advice about the conditions you should insert into your rental agreement so you minimise your chances of spotting it as a crime scene on the nightly news.

Don’t forget the kids!

Your property’s strongest selling point to a would-be tenant in these areas is the fact it’s in the catchment zone. Obviously, they’ve got kids! A one-bedroom apartment’s not a sound investment. You need at least two bedrooms. That said, you’ll still have the bones of a good investment with a smaller apartment because it won’t be on the radar for many investors.

Safety’s also a huge consideration for parents, so don’t overlook the glaringly obvious issues the property may have. Try and look for properties that are proximate to public transport and facilities such as parks, libraries and shopping centres. 

Timing’s everything

There’s no point in having your investment property ready to go if your timing’s out. You need to think ahead and plan year-long leases which dovetail perfectly with the enrolment period. That way your tenants can exit stage right when their kids graduate, and you can be guaranteed your property will stay occupied so as to keep the money rolling in.