[Mayya]

Hi, would you rent or buy?

We are two adults with 2 small kids living in the DMV area.

• Rent: We could rent a 3 bedroom in a nice building for 5200$ a month (schools are good)
• Purchase: We could purchase a 1940s house in the same area (schools are slightly better) for 1.2 mil. We are not handy but my husband says we will soon outgrow our 2bdr rental and would need another bedroom. I work from home and my husband works from home half the time.

Thank you for your input.

[Stella]

I don’t think I can see an outdated 1940 home a very big investment. How much are the upgraded homes go in that area?

I def think you should buy!! But get a house that doesn’t need much work. It’s different to upgrade a kitchen that is 20 years old vs plumbing or install AC at a house from 1940!

I know prices are high but buying a house is always a good idea as long as it’s affordable to you and has potential to increase in value! Otherwise keep your $ in the market!

It seems you should “buy” soon, but not THIS house! Unless upgraded houses in that area of the same size go for 3 mil.

[Carolyn]

I think it depends on the location. Also is there a third option, to rent a house vs an apartment in a nice building? How old are your kids? (Ie, how many years until school starts)? And honestly the most important question is what is your income and can you afford both options and still be able to meet your financial goals?

[Laurie]

We were in a similar situation in 2002 (I know – a lifetime ago) in the DMV area. Husband was assigned to the old Walter Reed and also worked at Bethesda Naval and occasionally at the VA and at the Capitol. We had three school aged kids. Excellent public schools and “enough” room were our primary motivations, plus the ability to not have to cross the Potomac daily.

We started out looking at 1940’s brick houses in Bethesda area…. And wound up buying in Columbia Maryland. We are still in that house.

Our kids went to excellent public schools. We got much much more for our money the further out we went.

The negative part was the terrible commute.

Read on: How can we save money when buying an over-budget house?

[Jin]

DMV = DC/Maryland/Virginia area in case anyone else was lost 😀

[Stephanie]

Are you looking in Georgetown? Those are pretty high prices.

But that is about what I saw in the last few days looking at rents near Tenleytown.

[Sylvia]

If you’re relatively new to the area, I would rent even though most mortgages are much cheaper than rent for smaller places. It’ll give you a chance to figure out whether you want to stay put in that school district.

We 1st bought a TH in ffx ctry in 04 when the interest rates 1st started plummeting.

Prices kept going up until they dropped in 08. When we had to move in 11 still in ffx but for a bigger house in a better school district, we got a great deal on our new house but if we had to sell the TH, we would lose $.

We turned the Th into a rental and finally sold in 20. Prices always appreciate in the area but you have to be willing to be patient

[Gayle]

In Texas if the plan for the kids to go to University of Texas only the top 6% of each school is guaranteed acceptance. When we moved at my daughter’s 9 grade I looked at houses in the best school district. She would not have been top 6%.

I also saw the real estate taxes for those school districts were 3 X. Yes 3 times another not so fabulous school district.

I also looked at how many students were in the honors program and there were a lot less. I found that my daughter had a MUCH better chance there and she did graduate top 6 percent of her class and went on to become a Longhorn.

The house was only 30 minutes to downtown and 20 to the airport in Austin TX. My real estate taxes on 5 acres and a 1600 sq ft home was $3,600 at the not so great but still a good school district.

The better school district for the same house at the opposite end of Austin was $15,000. Yes that is correct.

Unfortunately we sold that wonderful property right before Elon Musk built his new Tesla plant 10 minutes away. Still mad about that. The house is worth about 3 x what we paid for it and I could not afford it now.

Proposed: Should we sell our house and move for my husband’s job and family despite the financial risks?

[Carolyn]

there is a big range of what a 1940s house might be. Are you and your husband into lawn care and basic maintenance of a home? because no matter the age of the home there will always be work to do if you buy.

[Suzanne]

If you’re in a good financial place now (able to save a decent % of income), postpone the decision for a couple years or until they start school. Yes, 2 bedrooms is snug as your kids grow, but you can save more $$ in the meantime. Plus, interest rates are likely to fall if you go the “buy” route.

Side note: beware of lead-based paint in a 1940’s house, especially with small children.

[Ansalan]

You can rent something much cheaper in the dmv. If you are sending your kids to public school, how they perform academically in elementary school has more to do with parents (or private tutors) than teachers. Then use the money you save to put towards a home in a highly rated school zone.

You also can buy a nice house in that price range that’s newer if you go to Howard County. That price point should also get you into homes zoned to Wooton, Poolseville, or even Whitman (if an older home that’s not a fixer upper) in Montgomery County.

Appropriate: 805 credit score, car loan payoff before house: impact & timing?

[Sarah]

Small kids don’t need their own rooms yet, maybe by 6-8 years old. How much is the mortgage on that $1mil house? More or less than $5200. Don’t forget to budget for home owners insurance and maintenance, older homes means more in maintenance. BTW, many people are posting on FB about being dropped by home
Owners insurance companies. You might want to do some research in your area on what is happening there.

[Fatima]

If your plan is to stay put, I’d purchase. The home can be a gradual Reno! I’d start with lead testing because you have little ones but if you’re in a good suburb of DC you can’t lose.

[Laura]

We are in DMV too. Prices are insane. Not sure they will get better anytime soon. If you are here for the long term and can buy in a good school district I would. But inventory is terrible.

[Author]

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