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Why Pay House Premium "for Schools" Instead of Private Schooling?


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2011 Jul 31, 3:24pm   33,961 views  147 comments

by bmwman91   ➕follow (5)   💰tip   ignore  

I am not a parent yet, but this has always sort of irked me. People get frenzied over which school district they are buying into and certainly, will seem to overpay for a house to get their kids into some school. Why is it that so many people take no issue with dropping an additional $100,000+ on a house to get at a school, but balk at the notion of private schooling? For $100,000 you could send your kid to a number of private K-8 schools and a college prep place like Bellarmine at $15k per year. It does not seem to compute. Thoughts?

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17   bmwman91   2011 Aug 1, 6:06am  

Agreed. I would certainly not suggest an automatic assumption that private school == better.

18   OO   2011 Aug 1, 7:31am  

Bellarmine or those more affordable, religious schools have an acceptance rate at top colleges far behind the best public schools in Palo Alto, Cupertino, Saratoga etc.

Good school districts don't come out of poor neighborhoods, fact of life. These are affluent neighborhoods to begin with, and good school districts come naturally with more affluent and well educated parents.

The good private schools in the Bay Area, Harker, Menlo School, Castilleja etc have a school tuition of $30K per year, and you may not even get in. To get into Harker, you need to start early with elementary school, because the spots in the high schools are quite limited for those who didn't go up the grades with Harker. It is not like you can just let you kids go to a crappy elementary school and jr. high, and then transition him to Philips Exeter overnight. So even for one kid, you are talking about a difference of $200K+ tuition disregarding inflation. I can assure you that schools like Harker increase their tuition much more than general inflation rate each year.

People are not stupid, especially those who can fork over $1M for their homes.

19   bmwman91   2011 Aug 1, 7:48am  

I will agree that there is some correlation between affluence & intelligence. However, I think that you may be taking it to a little bit of an extreme.

While the "top" public schools may have higher acceptance rates at "top" colleges, that does not necessarily translate into automatic affluence. It can certainly be an advantage, sure. However, I know and work with a number of folks that went to "top" colleges, and they are working with me making the same money at a top-10 employer. Naturally, it seems that a lot of the richest folks out there came from "top" colleges, so there is likely some correlation in there. At the same time, it still seems like people put aside common sense & work fervently just to "get the name." In some cases it pays off richly, but as far as I can tell, in most cases it doesn't seem to really put someone way ahead. Really, learning to work hard, solve problems and apply common sense to life seems to be a bigger delimiter between success & failure.

I suppose this might just devolve into an argument about which path leads to a happier life, which truly is pointless to discuss. I'll try not to pursue the "value of top schools" topic too much further (unless folks want to argue that topic).

20   thomas.wong1986   2011 Aug 1, 8:20am  

OO says

Bellarmine or those more affordable, religious schools have an acceptance rate at top colleges far behind the best public schools in Palo Alto, Cupertino, Saratoga etc.
Good school districts don't come out of poor neighborhoods, fact of life. These are affluent neighborhoods to begin with, and good school districts come naturally with more affluent and well educated parents.

You can always sniff out the Real Estate Interest when you read something like the statement above. They have their turf to protect.

Cupertino and Saratoga were never a affluent area during my early times. I graduated from Fremont HS back in the day. I have friends who graduated from Saratoga, Cupertino, Homestead, etc etc. Even back in the day, the best were well know, St Francis, Bellermine, etc etc. It didnt matter where you lived.

Now that you have a massive housing bubble over the past 12 years with people overspending, somehow your trying to rewrite all the history of this region. No one would make such a comment back in the 70s 80s and 90s.

00, anymore BS you want to come up with for the public to eat up.

21   thomas.wong1986   2011 Aug 1, 8:24am  

bmwman91 says

Really, learning to work hard, solve problems and apply common sense to life seems to be a bigger delimiter between success & failure.

Yes, following your bliss may pay off as has been the case for some.

22   edvard2   2011 Aug 1, 8:30am  

I don't have kids nor do I pay a lot of attention to schools. So I guess I'm not an authority on the matter. That said, after moving here from NC it seems that people are a little nutty about schools. It seemed like most everyone I knew back home just went to a public school- the one they were zoned for- and that was that. They sent us runts on our way and somehow things were fine.

The attitude here is crazy. People seem to go insane trying to get their kids into such-and-such schools. They'll pay out the wazoo to live in a neighborhood. Anytime the schools face cuts or there's a whiff of trouble that otherwise gets in the way of schools out come the yard signs.

I guess I can't help but think that perhaps some of this is overblown. Like I said- my Brother and I along with everyone else in the family went to ordinary public schools and later to ordinary state colleges. We both work in highly skilled professions and have done well for ourselves. The schools we went were rated mediocre. Does sending a kid to the "best" school provide any sort of real advantage?

23   thomas.wong1986   2011 Aug 1, 8:40am  

edvard2 says

The attitude here is crazy.

Of course its overblown, REA have their turf to protect and they will come up with a dozen 'marketing' reasons why you should overpay for a home here.

People who came to the region fall prey to this nonsense very easy. However if been here your whole lifetime, or at least during the 90s, the BS doesnt stick.. your immune.

24   bmwman91   2011 Aug 1, 9:00am  

edvard2 says

The attitude here is crazy. People seem to go insane trying to get their kids into such-and-such schools. They'll pay out the wazoo to live in a neighborhood. Anytime the schools face cuts or there's a whiff of trouble that otherwise gets in the way of schools out come the yard signs.

This is sort of why I made the thread. As a non-parent, it all seems nuts. People are focusing on schools a lot more than they are on their kids & parenting skills it seems. It just makes kids neurotic when they are force-fed a rationale that everything they do must be done for the sake of a single goal. George Carlin's bit on Child Worship sums it up pretty well. Why can't Billy go sit in the back yard & play with a f***in stick?!

Somehow it hadn't occurred to me that the schools thing was just another REA ploy. They convinced everyone that values only go up, to buy now or be priced out & that lending standards were unnecessary. It seems plausible that they warped perceptions of education too. My own experience has been that WHERE someone went to college matters a bit less than WHAT they did there. I'll definitely say that my Ivy League & MIT colleagues get a lot more attention from head-hunters, but we are all less than 5 years out of college. Among my older coworkers, it seems to matter a lot less.

25   ih8alameda2   2011 Aug 1, 9:16am  

hmm....while i do think that some parents are perhaps a bit overzealous about the school's ratings, and i do think that there are plenty of good public schools and that we don't all need to cram into the top schools, it's a bit laughable that people want to blame the RE whores for inventing the importance of a good school district.

I grew up here in the bay, went to public schools, graduated from UCB and then went to one of the top graduate schools in the country. Yes it was perfectly fine education but please don't kid yourself that good schools don't matter. Maybe there's not a huge difference between the top tier and good enough, but there is definitely a huge leap between good and East Oakland.

26   bmwman91   2011 Aug 1, 11:02am  

Sure. But we are arguing south-bay schools, which form what I understand have quite the same set of endemic problems as those in Oakland & that area.

27   thomas.wong1986   2011 Aug 1, 11:04am  

ih8alameda2 says

it's a bit laughable that people want to blame the RE whores for inventing the importance of a good school district.

REA come up with all the 'marketing' talking points for you to overpay but in the long run it may not prove right. Certainly REA no longer use the Booming Tech Sector as a reason to overpay as they had 10 years ago. Since then we had a pretty nasty implosion in current number of Tech employers/jobs. Someone need to keep telling them to STFU.

28   thomas.wong1986   2011 Aug 1, 11:15am  

bmwman91 says

My own experience has been that WHERE someone went to college matters a bit less than WHAT they did there. I'll definitely say that my Ivy League & MIT colleagues get a lot more attention from head-hunters, but we are all less than 5 years out of college. Among my older coworkers, it seems to matter a lot less.

Tech workers over the years, many still around come from SJSU, SCU, UCB, UCD, Chico, Sac State etc. Few more recently come from IVY league/MIT or even Stanford. Practically unheard of when I started in Big 8 or Tech. So much older employees are not that impressed. SV wasnt on the public radar screen for many years-decades and often ignored.

29   AnotherLaura   2011 Aug 1, 11:43am  

1) If you are newly married and plan to have several children, then it may be 25 years until your youngest graduates from high school. There have been huge changes in education in the past 25 years (online education for K-12; homeschooling; charter schools, open enrollment districtsetc.). Paying a big premium generally made sense in the 70s, 80s, and 90s, but is probably riskier now, as it would not surprise me at all if there were to be a massive shake-up in the public education world anytime in the next 10 years or so.

2) I have a cousin who paid huge money for a huge house in a top school district. Her husband, who thought private school was a complete waste of money, changed his mind after the eldest of his large brood was enrolled at the swanky new public school. They ended up with a HUGE mortgage and HUGE tuition payments.

3) Some parochial schools don't charge much for the third child and beyond, and they often work with parents who are church members so that EVERY child who is a member can afford to attend. Lutherans and Catholics are better than Episcopalians for keeping tuition affordable for members.

4) When people talk about a "good" public school they generally are talking mostly about test scores. But school is both an academic environment AND a social environment. There are 11 boys on the starting line-up of the football team whether the school has 250 students or 2500, and lots of parents are willing to pay for a small private school with "no cuts" athletics and school plays. A teenager who feels that he fits in at school and is kept busy with extracurriculars causes fewer problems and is less likely to get in trouble than a teenager who tried out for several things freshman year, didn't get accepted to any of them, and now smokes dope in the park after school or while cutting school. If you think private school is expensive, check out the websites for teen rehab programs.

5) What I recommend to people who aren't completely thrilled with the public schools in their area, but can't afford going private for K-12 is to use the public school for K-4 and 9 - 12, but use a parochial school for 5-8. You can supplement K-4 inexpensively with a Saturday foreign language school, swimming lessons at the YMCA, and piano lessons from the talented 12-year-old down the street. At the 5th grade level, the inferior curriculum of the public school and the public schools' aversion to tracking by ability, combined with the low morals and lack of discipline of some of the kids and their parents makes the middle school years an absolute Hell. Also, by 5th grade your child will want you to mind your own business regarding his school career, and will start to be more secretive about what is going on with his peer group, so it is more important to have him enrolled somewhere decent. By 9th grade, there is usually some sort of tracking system, and if your child tests well he will probably be able to avoid the riff raff for the most part assuming that the school district that you are in is not a complete lost cause. Also, the high school curriculum is more likely to be somewhat traditional at the high school level, while there is all sorts of experimental hogwash in the public school system at the 5th through 8th grade level. Even a run-of-the-mill parochial school will still try to teach English grammar and composition, etc., while a lot of public schools waste time with group projects involving gluing stuff to pieces of poster board. The kids who have been to parochial school usually have a better work ethic, too, which helps enormously with the transition to high school.

30   avpmenlo   2011 Aug 1, 1:34pm  

I completely agree with Laura's comments on the schooling! we are living in Menlo Park and actually had to pull our three sons from the high API public schools here for those very reasons.

We are now fortunate enough to have over paid for school real estate while paying tuition for private schools. Imagine how thrilled we are with that backfire!

However, we are going to put our house on the market as we are located within walking sitance to both Oak KNoll and Hillview here and the houses are currently flying off the market to get into the "great Menlo schools!" We will move to the fringe area of Redwood City, near Alameda, but still close enough to commute to their school and work.

We tried it and it wasn't for us. By the way BMR, our son got accepted to Bellarmine with honors and will be attending in the fall. Couldn't be more proud!

31   bmwman91   2011 Aug 1, 2:55pm  

AnotherLaura says

while a lot of public schools waste time with group projects involving gluing stuff to pieces of poster board

Haha. Yeah, there are a number of aspects of "progressive education" that seem sort of nonsensical. It is great to allow kids to express themselves, but discipline & learning what consequences are seem to be pretty important too.

avpmenlo, congrats. Make no mistake though, your son could wind up getting stoned in the senior parking lot at lunch. There were a few kids that skipped classes & smoked pot regularly. Bellarmine has a well structured discipline system, but you still need to ride his ass all the way through. It should round him out pretty well too with their community service requirements & heavy emphasis on social justice on top of more traditional academics. It also makes attending a co-ed college something to look forward to haha.

Funniest memory: Sex-ed class during sophomore year was classic. Instructor walks in, looks at his clipboard & counts off the attendance. "32...no 33 students, OK, so 33 experts on masturbation..."

32   civilsid   2011 Aug 1, 3:14pm  

I have no children and do not live in your area but having read much of the above, it seems that the discussion is basically return on investment but not one person that I read about discussed the return on investment of the superior education, just the increase in home value, and the tax deductibility of the home vs. the non-tax deductibility of the school.

What about having brighter kids that will make more money? Care to discuss that? Maybe they will help mom and dad pay down the horrendous mortgage or school loans becuase they are more successful.

Then again, playing devil's advocate, I grew up in a small town with more cows than people in upstate New York with 2 brothers, 4 sisters, and a dad that was a blue collar worker busting his arse to put chow on the table. Somehow, I turned out OK and already have 4-5 more money in my retirement than he does; and yes I went to the public school.

Consider that maybe the kids are bright or not bright, have a work ethic or do not have a work ethic. Apples do not fall that far from the tree!! Some are sinkers and some are swimmers. I don't think the school system makes that big of a deal. The parents do and the work ethic does. I did better than my father because I don't have 7 kids and I did not grow up on a farm. That simple. Same work ethic and same intelligence, plus or minus.

Yes, I took different arguments on the same topic, I do not claim to have a corner on the market, just want to bring up stuff I did not see already discussed.

33   avpmenlo   2011 Aug 1, 3:20pm  

Thanks, bmr,
I'll stay on him. He has two more brothers that will be coming through, so I need him to stay on top of it!

Hilarious visual on the sex-ed class...at least they have a good sense of humor!

As you and so many others point out, parenting is the key.

34   B.A.C.A.H.   2011 Aug 1, 3:24pm  

civilsid says

the discussion is basically return on investment but not one person that I read about discussed the return on investment of the superior education, just the increase in home value, and the tax deductibility of the home vs. the non-tax deductibility of the school.

Yep, that's the kind of people that've been attracted to the Bay Area in recent decades.

Welcome to Our World.

35   thomas.wong1986   2011 Aug 1, 3:48pm  

Sybrib says

civilsid says
the discussion is basically return on investment but not one person that I read about discussed the return on investment of the superior education, just the increase in home value, and the tax deductibility of the home vs. the non-tax deductibility of the school.

A real "Return on Investment" discussion would include parent recouping their cost of education with interest in the future when their kid gets a job.
Nope, havent heard of that ever happening.

36   conservativethinker   2011 Aug 1, 4:52pm  

patrick.net definitely attracts smart and funny folks... rarely do I see comments with such different inputs and thoughts all articulated nicely with a dash of humor. now go screw yourselves.

no, seriously, i didn't realize private schools could cost as low as 8k per year?? I live in LA, where public schools are 90% bad everywhere and your 11 year old smoking pot while munching on shrooms are part of the ciriculum... but I was under the impression that private schools will cost 25k per year minimum.

but i think it does come down to proper parenting, work ethic, and you can't just rely on daytime school anymore... you have to really push your kids with extra circular activities (piano lessons, swimming, kumon?)

37   tts   2011 Aug 1, 5:35pm  

OO says

Bellarmine or those more affordable, religious schools have an acceptance rate at top colleges far behind the best public schools in Palo Alto, Cupertino, Saratoga etc.

They're probably focusing on standarized testing or some such. In general private schools are hyped all to hell and gone but the reality is they're almost never any better than public schooling yet cost more. Which is old news (http://www.livescience.com/2575-study-public-schools-good-private-schools.html) but for some reason, usualy political, the whole "private schools are better!!" thing won't die. The reality is no school private or public or even the "good ones" in affluent or rich areas, are some sort of guarantee at producing a more educated child, ultimately the parents have to follow through at home and be involved as much as possible to help their children learn.

This is however time consuming and difficult, and usually both parents work full time jobs these days, so for the vast majority of families the reality is they're stuck relying on the school to do nearly all the work for them.

The end of effective parenting for most American families is the true and most awful cost of the Dual Income Earner Family IMO.

OO says

It is not like you can just let you kids go to a crappy elementary school and jr. high, and then transition him to Philips Exeter overnight. So even for one kid, you are talking about a difference of $200K+ tuition disregarding inflation.

Perhaps its just me but for even a filthy rich family to spend $200K on schooling 1 child is just obscene and foolish. I really really doubt you're going to get your money's worth of schooling. More than likely its just another version of "keeping up with the Joneses" for people with more money than sense.

OO says

People are not stupid, especially those who can fork over $1M for their homes.

Stupid? No. Foolish? Sure, you can be rich and foolish as well as poor and foolish. Plenty of rich folks got reamed out in the .com and housing bubbles just like everyone else. Plenty of them waste their money on pointless things like everyone else too.

Just because the rich do it doesn't mean everyone else should aspire to it or to see it as good...

And just because everyone else is doing something doesn't mean you should either.

38   Michinaga   2011 Aug 1, 8:36pm  

What I don't understand is why people buy million-dollar [i]houses[/i], shackling themselves to onerous mortgages and the stress that comes with that, just to live in these great neighborhoods. Why not go for an apartment that costs what a house in an ordinary neighborhood costs, and relieve yourself of all that risk?

In my area of Tokyo, there's one great public school near the university that everyone wants to send their kids to. Advertisements invariably mention it. And while you can buy a million-dollar SFH there, few people do. They buy 3BR apartments for half a million (or less) and get the benefits of the school district at a "regular" premium rather than a ridiculous, insane premium.

39   Hysteresis   2011 Aug 1, 8:42pm  

the normal people i know that went to great schools, did just okay.
they would have done the same if they went to an average school.

most people aren't taking into account the child's capacity to take in the additional benefits of a top-rated school. meaning if you're average, a great school will help but not as much as if you were gifted

people are badly confusing correlation and causation.
* because gifted people are gifted, they go to great schools and do great things.
* average people go to great schools do average things.

it's not the school but the person that determines success. average people think if you mimic a gifted person by going to the same school, this average person will have the same success which is far from the truth

it's kind of like the hippopotamus thread:REALTOR argument for owning a hippopotamus‏ except in this case, it's "parents argument for going to great schools". the school is the hippopotamus.

40   seth.engstrom   2011 Aug 1, 10:36pm  

Springer, Blach, Mountain View HS, UC Berkeley. Public schooling was fine by me.

41   AnotherLaura   2011 Aug 1, 11:29pm  

To add something to my overlong prior post:

(6) If you are on a tight budget and both parents work, be sure to compare the cost of your area parochial schools offering before and after school care to the cost of the before and after school care plus transportation offered in conjunction with the local public school. You may get quite a surprise, especially if you have two or more children. As a further benefit, at the parochial school your child stays at the same campus all day, while with the public school option there is the daily fear that little Tommy will miss the bus from public school to daycare and be stranded while you are at work. A lot of people just don't do the math, and end up paying more for something worse, especially since the public school invariably have more oneupsmanship with clothing, etc.

Also, parochial school runs to the 8th grade, which means all of your children are on the same campus. Your 2nd grader can be in after school daycare while the 7th grader practices basketball and the 5th grader learns to play the piano or organ. The school commute and extracurricular activity schedule is greatly simplified. The parochial school my children attended even took the younger children to swimming lessons at a neighborhood pool. My younger daughter was on the parochial school cheerleading team for a couple of years, and got all of that out of her system before (private) high school where she focused more on sports.

(7) Being the poorest family in a public school in a rich neighborhood is probably worse than being a full-scholarship kid to a swanky private school, because at a private school the kids are spread out geographically and don't usually know too much about where most of their classmates live. I personally experienced the former situation, and it was NOT pleasant. It is far better for your child to develop a real lifelong social network of middle-class kids than to be a bitter social outcast among the offspring of the rich and famous. You may think that your child is so gifted and outgoing that having the wrong car, wrong house, and WRONG CLOTHES won't stop him from being class president, but you are mistaken.

I also agree strongly with people who have posted above that avoiding a bad school district is a lot more important than trying to find the perfect school. No child should have to go to school worried about being jumped in the bathroom, or being stuck in a "mixed-ability classroom" where they drill for the state exams all day, every day. Once you are in at least an average school district, there are diminishing returns on paying more and more for a house so that you can be in a better district.

42   edvard2   2011 Aug 2, 12:33am  

civilsid says

Consider that maybe the kids are bright or not bright, have a work ethic or do not have a work ethic. Apples do not fall that far from the tree!! Some are sinkers and some are swimmers. I don't think the school system makes that big of a deal. The parents do and the work ethic does. I did better than my father because I don't have 7 kids and I did not grow up on a farm. That simple. Same work ethic and same intelligence, plus or minus.

This is worth repeating. The bottom line is that just because you do this, this, and that for your kid doesn't mean he/she will automatically be a success in life. They could be sent to the absolute best schools and live in a sheltered bubble in a squeaky-clean neighborhood. They could still turn out rotten. Same could also be said for a kid who went to the worst schools in the worst area. Then again kids in either scenario could turn out to be geniuses and go on to become millionaires.

43   Tude   2011 Aug 2, 12:40am  

seth.engstrom says

Springer, Blach, Mountain View HS, UC Berkeley. Public schooling was fine by me.

I'll go even farther...

GED, Community College, UC Irvine, dropping out of public High School was fine by me.

44   Tude   2011 Aug 2, 12:43am  

edvard2 says

This is worth repeating. The bottom line is that just because you do this, this, and that for your kid doesn't mean he/she will automatically be a success in life. They could be sent to the absolute best schools and live in a sheltered bubble in a squeaky-clean neighborhood. They could still turn out rotten. Same could also be said for a kid who went to the worst schools in the worst area. Then again kids in either scenario could turn out to be geniuses and go on to become millionaires.

My husband grew up in Orinda and went to Miramonte, ended up a college drop-out. He has loads of friends from Miramonte that have not made a damn thing of themselves, and others, with mostly help from their rich parents, that are rich. He also has loads of friends that went to Richmond public schools that are happy and successful people.

I think people hyper-focused on school districts are insane, and are breeding some pretty fucked up kids.

45   SiO2   2011 Aug 2, 12:46am  

Sashi, you asked about $8k schools. In Silicon Valley, $6-8k gets a small k-5 parochial school. Basically, attached to a church, one class per grade.
$12k gets a bigger parochial k-8, like Valley Christian.
$12k-$25k gets a secular k-8. Old Orchard is one of the ads on the bottom of this page, that's $12k. Harker is around $25k.
$10k-$15k gets a parochial high school, like Valley Christian, Bellarmine.
$25k-$30k gets a secular high school, like Harker, or Castillejo.

Just to put that all in perspective compared to a $100k premium on the house. You can see that even with one kid, paying $100k which you will likely get back on resale is not bad compared to these. Of course all bets are off if Silicon Valley turns into Detroit.

seth.engstrom, those public schools (Springer, Blach, MV HS) are Los Altos, Fortress. So yes, those are considered good and worthy of a premium.

46   NYblogger   2011 Aug 2, 12:49am  

It is a complicated question. Here in NY metro area using a hypo of two kids. and comparing NYC upscale with suburb 30 mins from NYC via train. Where Tim Giethner lived when he ran Fed Reserve bank of NY (my son went to school with his son).

Decent house but fairly modest (though he bought it for 1.6MM in 2004). .18 acres and probably about 2500 sq ft. He couldn't sell had to rent for $7,500 a month. Area has 20+MM homes.

http://money.cnn.com/2009/06/03/real_estate/Geithner_housing_market/index.htm

They did a spoff on it on the daily show. Can find on youtube.

Anyway, NYC 1500 sq ft decent condo apartment (not luxury...non doorman, little amenities, etc) is about $1000 a sq ft and about 1.5MM. Then in NYC in the context of this audience you would be looking at private school (I grew up in public school in the Bronx in the 70s/80s and have a close and personal vantage point in the difference between inner city schools and very good suburbian schools and I have family and colleagues in some of the best private schools in NYC (kennedys, fords, etc kids go to). Private school for two let's say costs $50,000 per year (with multi kid discount -- fairly conservative). Taxes low in NYC but you are paying maintainance fee for common areas (less than a coop fee though). So PITI breaks down into ( just doing ITI as P is paying down the loan) lets say at I@5%=$75000, T@1%=15,000 and Insur+main@1%=$15000 SO $105,000 PER YR + $50,000 so $155,000 per year for apt and kids school.

Larchmont for a 2500 sq ft house on less than a quarter acre is say same cost 1.5MM. So using same equation I@5%=$75000, T@2%(higher taxes for school) is $30,000, I+M@1%=$15,000 total is $120,000.

So NYC apt is $155K/yr and NYC upscale suburb is 120K/yr. With city you have city at your fingertips all the time and short commute. With suburb you get more space and more greenspace. However, generally around here the city is going to cost more for a comparable school. (you can get decent schools in other school districts for less but to keep it as apples to apples as possible I used an upscale school suburb but it is far from the best .. scarsdale and other areas will be more expensive).

Here is the thing though. I have one son and I live modestly in a 800 sq ft 2 BR pre-war apartment in same school district (mamaroneck/larchmont) which has a decent stock of middle class housing and even some marginal areas (so school is relatively diverse) though it also has $20MM+ houses. I pay $2000 a month. A decent nut but safe, clean and my son gets a great school district. So I pay $24,000 a month vs the 120K or 155K above. If I lived in NYC and had the 800 sq ft apt I would pay $40,000 (rent) + $50000 (school) = $90,000. Sacrifice for me and wife on space but sometimes it boils down to individual preference (I want to save and I want a good education for my son so something had to give and it was the white picket fence...didn't really have an option to move as divorced and ex-wife lives here and we split time raising son). In addition, work somewhat tied to finance (not completely but somewhat).

47   SiO2   2011 Aug 2, 12:54am  

You can see a Freakonomics-type experiment about school prices in Santa Clara County.

In Los Gatos, north of Blossom Hill Rd and east of LG Blvd, there's a nice neighborhood; some houses are older, some are remodeled, some are rebuilt. The eastern part of this neighborhood is in Union district (reasonably good), the western is Los Gatos (considered better). The boundary line meanders through the neighborhood with no discernible pattern. A similar house in Union will be about $100k less than in LG.

Also, in Saratoga, north of Cox, between Saratoga Ave to the east and Saratoga-Sunnyvale to the west, it's similar. The eastern part is Moreland (reasonably good), the middle is Cupertino, the west is Saratoga. Next door neighbors can be in different schools, but the neighborhood looks about the same. Moreland to Cupertino is about a $100k jump, Cupertino to Saratoga is another $50k.

Essentially people are willing to pay a premium for these and view it as an alternative to private schools. With one kid, it's minimum $72k for k-8 and $40k for 9-12 = $112k. Max is $225+$120 = $340k. Multiply by the number of kids. A $100k-$150k price rise increase is a reasonable alternative, even considering that you'll pay interest and property tax on that increase. (Plus the interest is deductible, and the property tax may be if you dont get hit by AMT.)

48   Carl1   2011 Aug 2, 1:18am  

Realistically a private school such as Menlo will be $35K or so If, and only if, your kid a) gets in and b) doesn't get expelled. There aren't actually a lot of private schools in the area, but generally (nationwide) the better private schools will expel kids in a flash, or nearly so.

The correct choice is to a) pay extra for good schools as a backup and b) send your kid(s) to the best available school anyway. Welcome to parenthood. And perhaps you thought homeownership was expensive....

49   mdovell   2011 Aug 2, 1:57am  

"Also, while private school teachers may earn less, I do not think that it necessarily means that the quality is less. As many will note, if money was the only thing wrong with the education system we could easily fix it. "

I don't believe that throwing money at anything solves the problem. But public education has been so largely ingrained in the country that it make private look a tad odd. Then again nearly every President I can think of has sent his children to private school...maybe that says more about the system of D.C but I don't know.

I know a fair amount of teachers and most will not work in private schools because the pay is that much lower. Now I don't know if the unions are as much in private as public but you also have to consider the records. Anything that is public generally has more open records than private. A private company or any organization is under no legal obligation to provide information to someone (unless of course it is a court order).

As mentioned earlier parenting is key here. If parents don't care then the student won't really care. I just bumped into an old coworker. I thought he finished his undergrad in business. Apparently he failed out! He didn't even blink an eye. He told me his parents financed it. This might be on a tangent but if you read William Easterly's White Man's Burden (it references the Kipling story the book itself is about foreign aid). If people do not pay money for something then they have no ethical right to complain.

When you think about it how many people just easily rent an apartment to get their students into a school or how many have parents pay for private. If there is no sense of ownership or a stake then they might not have the performance.

Testing is such a mix because on one hand test results are the easiest way to determine if a student knows the subject at hand. Others might look at it as simply a form of memorization. On the other hand often times it is the learning process that can transfer from one subject to another, that is much harder to quantify within the boundaries of a standardized test.

The funny thing about standardized tests though I will say is that if it is standardized then it completely nullifies the idea of the teacher presenting anything really different. Khan Academy teaches the vast majority of what K-12 will have...and it is free. Websites do not care what time it is and what day it is and do not go on strike etc. I don't think that schools in general are really prepared for what the internet and ebooks will bring in the future.

Now we have "helicopter parents" that want to monitor everything 24/7.

It wasn't that long ago that students walked home from school, did not have cell phones, did not wait in a car at the bus stop, did not have "play dates" etc.

50   commonsense   2011 Aug 2, 2:56am  

@Sybrib You wrote, "I never did drink that Cool-Aid." I am with you there, neither did I!

The more I take a serious look at this smoke and mirrors Wizard of Oz'esk real estate bullshit of the past ten years it makes me realise how utterly insane the public really are.

51   conservativethinker   2011 Aug 2, 3:17am  

Thanks for the response SiO2. Some additional thoughts:

- Since there are generally more elementary schools per area. One approach is to get a place near a top rated elementary school, get K-5 covered. Then pay for 6-12 of private schooling.

- There is definitely an education bubble or something crazy going on. We are talking minimum 25K for just K-12 schooling?? College is almost that much now. You have to hope your K-12 private schooling will get your kids a scholarship to college, otherwise, you are talking about a half a million dollars per kid for their schooling (in today's dollars)

- I really believe alternate forms of education are going to start coming up to compensate for the point above. THis could be some type of "group home schooling" - which could be a group of families getting together and sharing tuition costs for basic education (math, language, etc)....maybe something like this exists already, i don't know. You combine that with a ton of extra curricular activities where your kids get exposed to other things and develop social skills by interacting with different people in different activities. Maybe you go spend your two weeks of summer vacation in different countries and enroll your kid into 2 weeks of some local educational program.

- also, i believe math, language(s), arts, social activities and sports are really the only core specialities kids should focus on... everything else will be driven by the kid's natural interests and passions

52   greatape   2011 Aug 2, 3:21am  

Had to post my first ever comment on this thread.

Its not always "fortress" areas that people are clamoring to get into. We were homeowners (debtors) in Hayward when we had our son in 2003. We sold that house and bought a very similar home in Fremont because that school district, while not as good as cupertino, etc, is a million times better than Hayward.
We paid approx $125k more for essentially the same house but the benefits are more than the school. Its a much better neighborhood (no bikers and gangstas) and I don't worry about my kid playing with the neighbor kids.
We could have stayed in Hayward and paid for private school....we did consider this. But he'd still have to come home to the same crappy neighborhood. I don't have a problem at all with low-income people....I've been one myself more than once!! but I do object to the thugs down the street letting their pit bulls roam all over the neighborhood.

53   chip_designer   2011 Aug 2, 3:57am  

Any public school in USA is still 100 times better than the public school system in 3rd world countries. I also don't understand why parents put so much passion on getting their kids the best schooling. Is it a feeling that one person only strives for that passion once you become a parent? Practically speaking, why should a parent sacrifice so much for the kids school, when your kid will outlive you, and no guarantee of the kids outcome. "I bring you to the world, I provide you love, food and clothing and basic necessities, and toys, then after you finish public high school, it is all up to you!". The world is very complex, younger generation will suffer more, they will need to work harder.

54   David12345   2011 Aug 2, 4:56am  

Ok, this is what I think the best solution: RENT a place with good school. BUY when your kids are out. That what we did.

55   pkowen   2011 Aug 2, 4:59am  

edvard2 says

That said, after moving here from NC it seems that people are a little nutty about schools. It seemed like most everyone I knew back home just went to a public school- the one they were zoned for- and that was that. They sent us runts on our way and somehow things were fine.

EXACTLY. It is completely nutty here. What I find really amusing is all this 'Tiger Mom' business which seems to focus entirely on credentialing the child rather than building a capacity for critical thought. You can see it in the adults they turn into. Great at math, poor at thinking.

56   foxmannumber1   2011 Aug 2, 5:13am  

PersainCAT says

you know the one thing no one has brought up yet is the fact that for the vast majority of the country private schools are not available.


Where i grew up there simply WASN'T a private school to choose. My parents bought a house that was 30 miles from work so that we could be on the edge of the best school system in the region. It may not have been 100k premium (it being very rural) but there was a 5-15k cost to live in that school district over the less desirable ones.

Private schools mostly exist in areas where white people are not the super majority. Outside of the south and large metro areas private schools are mostly unnecessary.

White liberals enable undesirable minorities to move into their general area and then they spend insane amounts of money on self segregation.

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