The Best Schools for Your Real Estate Buck

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Falmouth, Maine, is a picturesque waterfront town 110 miles north of Boston with moderate housing costs (median price: $351,550), per-student public-school spending just a touch above the state average, and an enviable position at the top of the Forbes/GreatSchools list of Best Schools for Your Real Estate Buck.

Not much stands out to explain why the 2,100-student school district does so well. The seventh-graders all have laptops, but so does every other middle-schooler in Maine, thanks to a 2002 program that has distributed Apple MacBooks throughout the state. Teacher salaries are generous by Maine standards, at around $51,000 for a 10-year veteran, but low compared with $75,000 to $100,000 a teacher can earn in New York. At $10,000 a year, per-pupil spending is slightly above average for Maine but well below the $14,000 or so big cities like Chicago and New York spend.

In Pictures: The Best Schools for Your Real Estate Buck

In Pictures: Best Schools for Your Real Estate Buck

Here's one clue to the superior performance of schools in this 10,669-resident town, which was founded in 1658: Teacher turnover is extremely low. In the 13 years Barbara Powers has been school superintendent, exactly two teachers have left for jobs at other schools.

"People aren't using us as a launch pad to somewhere else," said Powers.

Falmouth scored the highest on our second-annual list of The Best Schools for Your Real Estate Buck, a look at the places in America where your housing dollar will go the furthest in getting your children a great education. Done in partnership with GreatSchools, we analyzed 17,589 towns and cities in the 49 states that administer standardized, statewide tests (Nebraska doesn't have one test). GreatSchools also used results from the most recent National Assessment for Educational Progress data, a federal program that tests randomly selected students in fourth, eighth and 12th grades to provide state-level assessments of learning and educational progress. By combining the two datasets, GreatSchools could calibrate the results of individual cities in a single state with national standards to come up with an absolute score for each city. It then graded them on a curve with the highest-ranking city, Falmouth, representing 100. GreatSchools assesses more than 200,000 public schools, including public charter schools.

There are difficulties in ranking schools according to the town or city they are in. In addition to leaving out Nebraska, GreatSchools had to eliminate towns with less than 10,000 residents or fewer than five schools. And cities with sprawling, unified school districts like Houston and Los Angeles might harbor extremely high-scoring schools whose results are cancelled out by underperforming ones.

For the Forbes list GreatSchools also eliminated towns with unemployment rates above the state average, since few people would be motivated to move to such areas just to get a bargain on public education. Forbes then cut the list by median housing prices: $100,000-$200,000, $200,000-$300,000, $300,000-$400,000 and so on. Our top cut is over $800,000.

The resulting lists once again demolish the idea that more money equals better schools. Falmouth's performance outshone that of big-dollar school districts like Manhattan Beach, Calif., and New Canaan, Conn., both of which have median house prices above $1.1 million yet scored sixth and 19th, respectively, on an absolute scale. In fact, towns with homes costing between $200,000 to $399,000 represented a sweet spot in the list, grabbing more schools in the Top Ten than any other grouping, including the first, fourth and fifth-place finishers as well as schools scoring 13th and 14th. In the over $800,000 category, only Manhattan Beach was in the Top 10, while the rest scored 19th or worse.

Even Palo Alto, home to the brainiacs who brought us large hunks of the modern technology economy, scored a lowly 29th on an absolute scale. Parents willing to move to Pella, Iowa--median home price, $148,200--can avail themselves of the schools ranking third. St. Johns, Fla., with a median home price of $181,700, came in ninth with a score significantly above that of Westport, Conn., where a typical house costs $930,000.

Falmouth resembles those far richer cities in some ways. It's affluent, with lots of professionals who work in nearby Portsmouth or at home. Many residents moved from cities like Boston and New York for the rural scenery and sports environment of Maine.

Here are the top 10 Best Schools for Your Real Estate Buck:

10. Southlake, Texas
Pop. 26,297
Median Home Price: $476,880
Score: 95.74 (of 100)