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Business & Finance

EdHeroes: The symbiotic relationship between Education and Property Value

JAKARTA, Indonesia, Feb 21

Property prices grow with good schools nearby, how can we predict those prices? EdHeroes Indonesia [] (part of the global EdHeroes Movement []) held an online forum [] where Nicholas St Johnston (Senior Property Specialist at International Finance Corporation), Andrey Galiev (senior adviser at Rybakov PlaySchool), and Basuri Tjahaja Purnama (President Director of Jababeka Morotai SEZ) spoke about the influence of high quality educational establishments on the value of real estate on Saturday January 29th 2022. They gave suggestions on how to make smart investments, and provided insight into real-life situations.

Property value grows with quality educational establishments in close proximity. Nicholas St Johnston mentioned there are several factors that influence property value, most important of which is access to quality education. Families, whose children are school-age are most willing to pay extra for housing if a quality school is in close proximity. A research by BI Group shows what people are willing to pay for near-school-housing, broken down by age group. Andrey shared his personal example with Playschool [] in Russia. This educational establishment increased nearby property value once families with school-age children began moving closer, demand for housing increased and property value soared. Many developers construct housing projects with schools in mind, knowing property value would be higher.

To be ahead of the prices, and to make smart investments, it is important to have a level of financial education. Andrey Galiev emphasized the importance of knowledge and literacy when it comes to investing in property. The decision made to invest in a certain property, especially with intentions to live there, could contribute to the quality of education that the family’s children receive. Since school attendance is influenced by school proximity, it is integral to engage in research and understand the market. This is why financial education is vital, and could be aided by comprehensive educational plans devised by financial institutions. Governments are already investing heavily into infrastructure to ensure easy access to quality education, since return on investment into children’s education could increase 16-fold.

Sending children to desirable institutions is of utmost importance in itself, and it could be discouraging to find high-priced housing nearby. Once there is a good understanding of the relationship between educational establishments and real estate, one could make smart property investments and significantly increase their capital.

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Source: EdHeroes Foundation