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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]There are some many decent properties available for under $1M. Here's an example of a small SFH in Falls Church at $729K.

https://redf.in/e9As2Q[/quote]

With a high school rated 2/10 — so you have to budget for private school. [/quote]

No you don't.

You have around 15 years from when your kid is born to build equity, grow your career, and move to a house with a better high school.

That's literally the entire concept of a starter home. [/quote]

That’s the trap around here. Places with bad school don’t match the appreciation of homes with good schools; so you actually probably fall behind compared to renting and investing the difference. Same problem with condos and townhomes.

A starter home needs to be in targeted neighborhood to work out, but those have been snapped up by builders and torn down [/quote]

You're forgetting that home ownership gives you massive leverage of your money. You can get on the property ladder with very little startup capital - an FHA loan on a $425,000 2br condo in a nice neighborhood or rowhouse EOTR only requires about $15K down but you're getting appreciation on the full $425K, not to mention a portion of your mortgage payment goes to equity.

Let's look at an example. Person A puts 3.5% down on a $425,000 home with a 6% mortgage and assuming 6% growth in home prices. In 7 years their house is worth $640K and they've got $272,000 worth of equity.

Person B puts $14,875 in the stock market at 12% growth. After 7 years they have $33,000.

Person A now has a substantial down payment on a home they can raise kids in. Person B has a nice vacation.

[/quote]

A 425k condo will not appreciate that way in 7 years. Not even close. You will *maybe* sell it for 500k in that time, assuming great neighborhood that doesn't also have an influx of new construction condos in the interim. You also have to factor in closing costs and maintenance.

Signed,
A condo owner in DC who cannot afford to upgrade to a SFH after 10 years even though we have a lot of equity in our condo at this point[/quote]

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