[quote=FlyerInHi]Of course, the most expensive house, if you can afford it, or even sacrifice by stretching for your kids. The reason is simply in the thinking that the extra value in the house will be always be there.[/quote]
Agreed.
But during the years their kid(s) are using those schools (12 – 20 years for those whose oldest is in first grade), the parents have to pay the (increased) mortgage and taxes based upon a higher assessment at the time of purchase plus 2% compounded per year. How much is this difference every month?
That extra monthly outlay (minus any of it being applied to principle) isn’t paying down their debt and thus can’t be recovered upon sale. Perhaps the extra amount of interest (to buy the better schools with a higher mtg) used for the MID would benefit most families on their tax return.
The parents purchasing the higher-priced home have also invested more of their own money towards the downpayment which cannot now be deployed elsewhere.
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I just thought of something. Private schools run about $4-10k yr through grade 8 for one kid (Catholic schools being the least expensive). Private HS’s (both religious and secular) run $10-$20K per year per kid.
I can see why some families choose this option, especially if they have “inherited” an older home in an area where the schools aren’t considered as good. Also, for those parents who took an oppty to purchase their “dream” period home in the urban core and only have 1-2 kids.
