Tiger Crunch: More Students Than Seats Caps Home Prices in Beijing

Parents will pay through the nose for housing in a good school district, but even these home prices are stabilizing.

In order to not let the children lose at the starting line, many parents do not hesitate to spend money to buy the school district room. Recently, the annual "kindergarten into primary school" has entered the end, most parents find it, let the children on the ideal target correction. But by the students adjust, adjust the school district and other factors, there are also some parents even bought a school district, did not let the children into the elite door. For these reasons, coupled with the rise since March this year, too, and some of the traditional school district housing prices have stopped rising, even a slight decline.

...Homelink Real Estate Financial Street Area Xiaoge also said that now the school district housing prices rose no more.

Only a couple of weeks ago I [posted Why Some Beijing Home Prices Soar:

In Beijing, 160,000 students want to enter schools with a quota of 5,000, and requirements to qualify for Beijing schools are being tightened.

The demand for schooling drives up home prices near good schools, but now its at the point where the inability to get into good schools has capped the demand for housing in some of these areas.

The article out today discusses a Mrs. Sun whose child was denied entry to the school she thought he could attend. He was enrolled in a regular school instead. She sacrificed to buy a house in the school district and purchased three years ahead of her son's enrollment in primary school. This is happening all over Beijing as parents drove up prices in good school districts in anticipation of enrolling their children in better schools.

As an aside, some Chinese will time their births in order to land in an auspicious year, such as Dragon. There was a study I posted some years ago in Dragon Baby Boom, which found children born in the Year of the Dragon in the U.S. have slightly higher educational attainment. The effect was likely due to parental selection: the types of parents who would follow through on a plan to have a baby in a specific year also likely have slightly higher educational attainment than the general population. In China, however, where there's only one child and many parents may be doing something similar, a good strategy is to pick the worst animals so as to reduce the competition. The children coming into primary school in 2016, if they are age 6, would be Tigers.

iFeng: 北京买房上“牛小”计划落空 传统学区房价格停涨