D.C. Real Estate's Most Powerful Person: Public Schools Chief?

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Does the blunt, no-nonsense administrator of Washington, D.C., public schools actually influence home values in the city?

Washington City Paper blogger Lydia DePillis argues that Michelle Rhee does, although area Realtors and residents aren't as sure.

In her three years as schools chancellor, Rhee has shuttered under-performing schools, fired administrators and teachers, and invested millions in professional development. Parents are becoming more involved citywide, and test scores, overall, are on the rise.

Citing the experience of D.C. Councilmember Tommy Wells, who says Realtors gush to him about school improvements and increased housing values, DePillis dubbed Rhee "the most powerful person in D.C. real estate."
Certainly, something is keeping residents in the city, once their children turn 4 and 5.

"For a long time, people moved away when their kids reached school age. They are not doing that anymore," says Meg Shapiro, an agent with RE/MAX Allegiance who covers Capitol Hill neighborhoods. Shapiro's oldest child attends Washington Latin, a charter school for grades five through high school. "Are people staying just because of the schools?" Shapiro asks. "I don't know. It's really cyclical."

Real estate agents are the first to say good schools mean higher property values. Yet agents are bound by the Fair Housing Act to restrict opinions on what they consider "good schools." Additionally, empirical data showing a correlation between a high performing school system and property values is also hard to come by.

A 2004 study of the desegration of the Mecklenburg County, N.C. schools found test scores to be less influential on property values than, say, the differences in established housing prices within school boundaries, changes in assignments and changes in peers at a school. ("The impact of schools on housing values appears to be largely indirect, through the residential sorting that goes hand-in-hand with school boundaries and reassignment," wrote the authors of "Do Good Schools or Good Neighbors Affect Property Values?")

So Rhee's successes in improving schools may be less influential than, say, the fact that parents become more involved in their neighborhoods and communities offer amenities that make them more attractive to families.
Not surprisingly, the District's high-performing schools usually are found in upscale neighborhoods. Schools like Tyler Elementary on Capitol Hill and Key and Hyde elementary schools serving Palisades and Georgetown have long-standing reputations for quality education.

But increasingly, high performers can be found across the district. Students at Draper, a small school scheduled for consolidation in Barnaby Terrace, boasted 100 percent passing grades on reading and math assessment tests. And at Takoma Education Center, a kindergarten-through-eighth-grade school near Georgia Ave., students have raised scores -- thanks in part to an incentive program that rewards them for good behavior and grades.

Still, many schools continue to struggle in the District, and whether Rhee's policies will eventually turn them around -- and help pull home values up along with them -- depends on whether she stays in office. Rhee was hired by current Mayor Adrian Fenty, who faces challenger Vincent Gray in a primary on Sept. 14. Gray has not committed to keeping Rhee, if he wins.

Shapiro says that as a parent of a D.C. public school student, and as real-estate agent who works with buyers, she hears less about Rhee and more about whether D.C. high schools will improve, as the foundation elementary schools get better.

"There are some really quality programs at the schools, the math and science charter school, Duke Ellington School for the Arts. But parents are also looking for a rock-solid public high school option and are really watching what happens at Eastern High School," she says, referring to a school now under renovation.

"The renovation at Eastern, how it all shakes out -- that's going to change the dynamics of real estate in D.C.," she adds.

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