Buying houses for schools(2)

Parents are rushing to buy expensive houses near famous primary schools to ensure their children can be enrolled in these schools, due to new enrolment policy published in April, 2014. Photo: Li Hao/GT

The price of the bungalows has been rising since 2012, said Niu. "About two years ago the price was only about 50,000 yuan [per square meter], but the policy change has made parents and private dealers more and more crazy about the school district houses."

"Last year we sold one on a hutong," said Chen. "It was just a narrow space at the entrance of an old siheyuan in Fuxue Hutong (in the Shijia Primary School district). It was less than 4 square meters, not even enough room to hold a single bed, and it's in the open air, but it was sold for about 1.2 million yuan."

Education investment

Of course, not all the houses in these school districts are tiny hovels and the prices of better homes are also skyrocketing. In the Dongnan Residential Community, Haidian district, which belongs to the school district of the Zhongguancun No.1 Primary School, there are very few old hutong.

But the average price of property has reached 80,000 yuan per square meter.

"I just called for 5.8 million for this 73-square-meter house, which is a relatively low price at less than 80,000 yuan per square meter," said the current property owner, a middle-aged man surnamed Wang.

In the face of sky-high prices, Chinese parents have not hesitated to buy. According to Ai Yin, an agent working at the Zhongguancun branch of the 5i5j Real Estate Agency, they had seen a rush to purchase school district houses since October.

"We made about 100 deals in two months on school district houses, and now only have five houses available for sale in the whole school district of the Zhongguancun No.1 Primary School," said Ai. "Yesterday I made a deal for an 80-square-meter house worth more than 7 million yuan, and it was bought by a couple for their daughter's enrolment at the Zhongguancun No.1 Primary School."

Certain schools, such as the Shijia Primary School, do not have limits on how long the children's hukou have to have been registered in the school district.

"Almost all families buying bungalows do not really live there," said Chen. "They choose to immediately sell the property to get the money back, and probably earn some extra money, and they do it with private dealers, which just pushes prices higher and higher."

According to Xiong Bingqi, deputy director of the 21st Century Education Development Research Institute, school district properties have become a dual investment. "First it is an education investment; second it is a property investment," said Xiong in a Xinmin Weekly report in September.

No way out?

Guo Yongfeng, a 35-year-old businessman, came to Beijing from Hunan Province in 2003. After years of hard work, he married a Beijing local and bought a house to settle down in for his wife and son. However, he still found life in Beijing much more difficult than he had imagined.

Guo and his wife have spent more than 2 million yuan on their home in Shunyi district, and they want their son to go to a top level primary school, which means they have to buy a house and spend more. Guo's wife favors the purchase, but Guo does not.

"Although many friends and workmates are doing so, I think it is insane," said Guo. "Both the policy and the market are not logical, which are driving Chinese parents crazy, and I do not think that is a healthy environment for the development of primary schools and for children's growth."

Guo said parents like him have two choices. First, they can send the children to international schools which accept Chinese students, where excellent and different educational resources are available. "Even if the tuition is 300,000 yuan per year for ten years' study, it is still much cheaper than buying a house," said Guo. "But we would have to worry about our son again afterwards, and think about which kind of high school he should attend, after all, it is a totally different system compared with Chinese public schools."

Second, the parents can choose to send their children back to their hometowns. "My sister is working in Shanghai and her son was sent home back to Hunan province, where the boy can attend a municipal key primary school and junior high school," added Guo. "He can go back to Shanghai for high school and directly attend the gaokao, and we are considering this way, but both my wife and I are reluctant to be apart from our son."

This problem is fundamentally due to the importance society places on education, and the lack of decent education resources, Xiong said. "People should be treated equally, no matter which school they attended. Otherwise people will remain focused on exam scores and the intense competition for limited educational resources will remain."

"I know it is insane to spend so much on another house, which we do not need, but we have to, and thousands of parents have done that," said Li.