Parents want to send their kids to the best schools, but in order to do so, they may have to shell out a lot more in property taxes, reports MarketWatch staffer Catey Hill.
According to data from real estate research firm ATTOM Data Solutions, good public school districts — defined as districts with a minimum of one public school in which student test scores were at least one-third higher than the state average — cost 77% more than homes in average or below-average districts. The average home cost $427,402 in a good school district in July 2016, compared with $241,096 for other districts.
Let’s say you bought that $427,402 good-school-district home today, put down 10% buy it, and got a 30-year fixed rate mortgage on it at 3.2%. That house will cost you at total of nearly $600,000 over the life of the loan. On the other hand, if you bought the $241,096 mediocre-school-district house with a 10% down payment and the same loan terms, you’d end up only shelling out a total of about $340,000.
According to the Tax Policy Center, Westchester, Nassau and Bergen counties — all of which are near New York City and are feature excellent public schools — property taxes average more than $8,500 a year.