Do school zones affect property prices in Australia?
Yes. In Australia, properties located within top-performing school zones consistently sell for higher prices and experience stronger capital growth compared to similar homes outside the school zones. This is due to limited supply, strong demand from families seeking quality education and stable rental demand from long-term tenants. As a result, homes in sought-after school zones often achieve premium sale prices, higher rental yields and reduced vacancy rates, making them a reliable long-term investment.
What is a School Zone?
In Australia, school zones are geographic boundaries that determine which public school a child can attend based on their residential address. Each state and territory sets its own rules, however for many high-performing schools, living within the zone is the only way to guarantee enrolment.
For home buyers, a school zone can be the deciding factor in a purchase. For property investors, it can mean the difference between an average performer and a high-demand, high-growth asset.
How School Zones Impact Real Estate Prices
School zones influence property prices by increasing demand and limiting supply. When a school is well-regarded for academic results, extracurricular programs and facilities, the surrounding catchment becomes highly desirable.
Why prices rise in good school zones:
- Limited supply: Only so many properties exist within the boundary.
- High demand: Families are willing to pay a premium to secure a place.
- Market resilience: Even during downturns, these areas tend to hold value.
Homes in sought-after school zones often sell faster, attract more competition and can achieve prices well above similar homes just outside the boundary.
Long-Term Benefits for Investors
If you are buying an investment property in a top school zone, the benefits extend beyond just capital growth:
- Consistent rental demand – Families will often rent for years to stay in zone.
- Higher tenant quality – Education-focused tenants tend to be stable and reliable.
- Lower vacancy rates – Constant demand minimises vacant periods.
- Strong yields – Premium locations can justify slightly higher rent.
For investors, this means reduced risk, better cash flow and stronger long-term returns.
The Higher Buy-In Price
It’s important to note that buying in a top school zone often comes with a higher entry cost. Competition from owner-occupiers and investors drives up prices.
However, many buyers see this as a strategic investment decision. Over time, the capital growth and stable rental income often outweigh the initial premium.
How to Research School Zones Before Buying
If you are targeting top school zones for your next purchase, research thoroughly before making an offer:
- Check official boundaries – School zones can change yearly, so confirm on your state’s Department of Education website.
- Look at rankings – Review academic results, extracurricular programs and community reputation.
- Understand enrolment rules – Some schools require proof of residency within the zone.
- Track recent sales data – Compare prices inside and outside the zone to see the premium.
Tip: Even if you don’t have children, buying in a good school zone can future-proof your investment.
School Zones and Capital Growth
Historical data shows that properties in top-performing school zones often outperform surrounding suburbs in both rising and falling markets.
Examples:
- Melbourne: Balwyn High, McKinnon Secondary College, Glen Waverley Secondary College
- Sydney: Epping Boys High, Willoughby Public School
- Brisbane: Brisbane State High School, Indooroopilly State High School
These areas have consistently delivered above-average capital growth and rental yields.
Tips for Buying in a Good School Zone
- Be prepared to act quickly – Homes can sell within days.
- Expect competition – Have finance pre-approved to strengthen your offer.
- Consider property type – Even small units in a good school zone can outperform bigger homes elsewhere.
- Think long term – This is a buy-and-hold strategy, not a short-term flip.
Why Buy a Home in a Good School Zone?
Even if education isn’t a priority for you right now, buying in a good school zone can provide:
- Better resale potential – More competition when selling.
- Long-term stability – These areas are less volatile in downturns.
- Wider appeal – Attracts both families and investors.
It’s one of the few location-based factors that consistently delivers strong results for both owner-occupiers and investors.
Potential Risks to Consider
While the benefits are strong, there are some risks:
- Boundary changes – Rezoning could move a property out of a sought-after zone.
- Performance shifts – A school’s reputation can change over time.
- Overpaying – Some buyers get caught up in competition and stretch beyond budget.
Final Thoughts
Whether you are purchasing your family home or your next investment property, school zones can be a powerful driver of property value, demand, and long-term performance.
Key takeaways:
- Good school zones mean strong demand and stable prices.
- They offer resilience during market downturns.
- The higher entry price is often offset by capital growth and rental returns.
By factoring school zones into your real estate strategy, you set yourself up for a more secure and profitable purchase – whether you plan to live in it or rent it out.
By Lynda McNeill
