MOVING IN THIS MARKET!

[one_muggle]

I have a similar (enough) situation that I ran some simple numbers for this just last week.

Just to give you an idea, the current cost for private school (in my area) starts around $1k/month/kid. With 2 kids, that is a monthly equivalent to a $300k 30yr fixed loan at 7%.

With LostCat’s projected profit, that means you could buy a ~$550k house in a neighborhood with good public schools, for the same price as today’s private school tuition.
This is very back of the envelope, since taxes, opportunity cost (for the $250k), etc are not included. But it just gives one an idea of how much house you could get, just for the cost of private school.

Long term, the cost of school will rise, but your mortgage should stay the same (except your write-off starts shrinking). If house prices were stable, and the good public school were just as good as the private–BUY or RENT.
If prices are rising rapidly–it’s a no brainer BUY.
If prices are falling rapidly–RENT.

For my case, since we already sold our primary residence, we will rent next year, when my oldest starts kindergarten, in the best public school district around. The rent premium to go from our very nice neighborhood–but with lousy schools–is about $1200/month. So, purely financially, it does not make sense, except that we have another one starting school sometime after and I am not jerking my kids around different schools to maximize my finances!

If all goes well, we are looking at buying in 2-4 yrs (RE depending) in the same neighborhood.
It made much more sense for us, than private school–though a major assumption is the equivalence of the good public versus private–another reason we are renting, rather than getting stuck. We want to find out first hand.

Good luck, I know from personal experience how freakin hard it is to figure out schools in SoCal.
-one muggle

[one_muggle]

I have a similar (enough) situation that I ran some simple numbers for this just last week.

Just to give you an idea, the current cost for private school (in my area) starts around $1k/month/kid. With 2 kids, that is a monthly equivalent to a $300k 30yr fixed loan at 7%.

With LostCat’s projected profit, that means you could buy a ~$550k house in a neighborhood with good public schools, for the same price as today’s private school tuition.
This is very back of the envelope, since taxes, opportunity cost (for the $250k), etc are not included. But it just gives one an idea of how much house you could get, just for the cost of private school.

Long term, the cost of school will rise, but your mortgage should stay the same (except your write-off starts shrinking). If house prices were stable, and the good public school were just as good as the private–BUY or RENT.
If prices are rising rapidly–it’s a no brainer BUY.
If prices are falling rapidly–RENT.

For my case, since we already sold our primary residence, we will rent next year, when my oldest starts kindergarten, in the best public school district around. The rent premium to go from our very nice neighborhood–but with lousy schools–is about $1200/month. So, purely financially, it does not make sense, except that we have another one starting school sometime after and I am not jerking my kids around different schools to maximize my finances!

If all goes well, we are looking at buying in 2-4 yrs (RE depending) in the same neighborhood.
It made much more sense for us, than private school–though a major assumption is the equivalence of the good public versus private–another reason we are renting, rather than getting stuck. We want to find out first hand.

Good luck, I know from personal experience how freakin hard it is to figure out schools in SoCal.
-one muggle

[one_muggle]

I have a similar (enough) situation that I ran some simple numbers for this just last week.

Just to give you an idea, the current cost for private school (in my area) starts around $1k/month/kid. With 2 kids, that is a monthly equivalent to a $300k 30yr fixed loan at 7%.

With LostCat’s projected profit, that means you could buy a ~$550k house in a neighborhood with good public schools, for the same price as today’s private school tuition.
This is very back of the envelope, since taxes, opportunity cost (for the $250k), etc are not included. But it just gives one an idea of how much house you could get, just for the cost of private school.

Long term, the cost of school will rise, but your mortgage should stay the same (except your write-off starts shrinking). If house prices were stable, and the good public school were just as good as the private–BUY or RENT.
If prices are rising rapidly–it’s a no brainer BUY.
If prices are falling rapidly–RENT.

For my case, since we already sold our primary residence, we will rent next year, when my oldest starts kindergarten, in the best public school district around. The rent premium to go from our very nice neighborhood–but with lousy schools–is about $1200/month. So, purely financially, it does not make sense, except that we have another one starting school sometime after and I am not jerking my kids around different schools to maximize my finances!

If all goes well, we are looking at buying in 2-4 yrs (RE depending) in the same neighborhood.
It made much more sense for us, than private school–though a major assumption is the equivalence of the good public versus private–another reason we are renting, rather than getting stuck. We want to find out first hand.

Good luck, I know from personal experience how freakin hard it is to figure out schools in SoCal.
-one muggle

[one_muggle]

I have a similar (enough) situation that I ran some simple numbers for this just last week.

Just to give you an idea, the current cost for private school (in my area) starts around $1k/month/kid. With 2 kids, that is a monthly equivalent to a $300k 30yr fixed loan at 7%.

With LostCat’s projected profit, that means you could buy a ~$550k house in a neighborhood with good public schools, for the same price as today’s private school tuition.
This is very back of the envelope, since taxes, opportunity cost (for the $250k), etc are not included. But it just gives one an idea of how much house you could get, just for the cost of private school.

Long term, the cost of school will rise, but your mortgage should stay the same (except your write-off starts shrinking). If house prices were stable, and the good public school were just as good as the private–BUY or RENT.
If prices are rising rapidly–it’s a no brainer BUY.
If prices are falling rapidly–RENT.

For my case, since we already sold our primary residence, we will rent next year, when my oldest starts kindergarten, in the best public school district around. The rent premium to go from our very nice neighborhood–but with lousy schools–is about $1200/month. So, purely financially, it does not make sense, except that we have another one starting school sometime after and I am not jerking my kids around different schools to maximize my finances!

If all goes well, we are looking at buying in 2-4 yrs (RE depending) in the same neighborhood.
It made much more sense for us, than private school–though a major assumption is the equivalence of the good public versus private–another reason we are renting, rather than getting stuck. We want to find out first hand.

Good luck, I know from personal experience how freakin hard it is to figure out schools in SoCal.
-one muggle

[Raybyrnes]

Seems you bought at the right time. I would struggle to give up that tax base in a state like CA that caps the increases. Over the long haul that going to provide you with a nice margin of safety as a rental unit.

I am looking at rentals and it is hard for a young family to rent their unit out when they over paid and the old timer next door is 200 to 300$ a month lower and is still cash flow positive.

[Raybyrnes]

Seems you bought at the right time. I would struggle to give up that tax base in a state like CA that caps the increases. Over the long haul that going to provide you with a nice margin of safety as a rental unit.

I am looking at rentals and it is hard for a young family to rent their unit out when they over paid and the old timer next door is 200 to 300$ a month lower and is still cash flow positive.

[Raybyrnes]

Seems you bought at the right time. I would struggle to give up that tax base in a state like CA that caps the increases. Over the long haul that going to provide you with a nice margin of safety as a rental unit.

I am looking at rentals and it is hard for a young family to rent their unit out when they over paid and the old timer next door is 200 to 300$ a month lower and is still cash flow positive.

[Raybyrnes]

Seems you bought at the right time. I would struggle to give up that tax base in a state like CA that caps the increases. Over the long haul that going to provide you with a nice margin of safety as a rental unit.

I am looking at rentals and it is hard for a young family to rent their unit out when they over paid and the old timer next door is 200 to 300$ a month lower and is still cash flow positive.

[Raybyrnes]

Seems you bought at the right time. I would struggle to give up that tax base in a state like CA that caps the increases. Over the long haul that going to provide you with a nice margin of safety as a rental unit.

I am looking at rentals and it is hard for a young family to rent their unit out when they over paid and the old timer next door is 200 to 300$ a month lower and is still cash flow positive.

[NotCranky]

“One option I was considering is waiting two more years, then renting my place out while I pick up a new place to live.”

Very sound strategy. Allied Gardens , and that house, should treat you very well as a investor/landlord.

[NotCranky]

“One option I was considering is waiting two more years, then renting my place out while I pick up a new place to live.”

Very sound strategy. Allied Gardens , and that house, should treat you very well as a investor/landlord.

[NotCranky]

“One option I was considering is waiting two more years, then renting my place out while I pick up a new place to live.”

Very sound strategy. Allied Gardens , and that house, should treat you very well as a investor/landlord.

[NotCranky]

“One option I was considering is waiting two more years, then renting my place out while I pick up a new place to live.”

Very sound strategy. Allied Gardens , and that house, should treat you very well as a investor/landlord.

[one_muggle]

djrobsd,

Do you really want to live around a bunch of spoiled rich peeps?
This is a major issue for my family as well, but we are finding (through private school tours) that we would face as big, if not bigger problem with the private school crowd.

The best (or worst in this case) is the private academy in my local ‘expensive school district’–these people buy the multi-million dollar homes to be in the desirable school district, and then pay $20k per year to go to private school.
I am not poor, but damn, that takes lots of disposable income.

-one muggle

[one_muggle]

djrobsd,

Do you really want to live around a bunch of spoiled rich peeps?
This is a major issue for my family as well, but we are finding (through private school tours) that we would face as big, if not bigger problem with the private school crowd.

The best (or worst in this case) is the private academy in my local ‘expensive school district’–these people buy the multi-million dollar homes to be in the desirable school district, and then pay $20k per year to go to private school.
I am not poor, but damn, that takes lots of disposable income.

-one muggle

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