NEWS

HomePW OnlineExpert ViewsShould You Ditch The City? Here's Why We Did

Should You Ditch The City? Here’s Why We Did

Earlier this year, as Covid-19 swept through the world, my family of four packed our SUV and set the GPS for our new home in New Jersey.

It wasn’t just the pandemic pushing us out of New York City. My husband and I came to the conclusion last summer that the returns of living in this expensive metropolis were diminishing. Our values had evolved as parents. We wanted more space as well as a strong school district. We were tired of the constant subway shutdowns and broken elevators in our building. And I couldn't remember the last time I’d been to brunch.

The health crisis further convinced us it was time to get the heck out. We’re not alone: A Harris Poll in April found that 39% of respondents living in urban areas cited Covid-19 as the main reason to consider moving to a quieter area.

The thought of moving to the suburbs inevitably crosses a city dweller’s mind at some point, perhaps with great resistance. Like a stubborn New Yorker, part of me wanted to stick it out and stay loyal to the place that, for 19 years, offered me so much prosperity.

But, after examining the trade-offs, I got over it.

You, too, may find yourself ready — dare I say, excited? — to start a new chapter in a more spacious house with a backyard, situated just minutes away from a Target. But before you begin packing, take note of these key points in the Do I Move to the Suburbs calculus:

The value of a house. One common reason people want to move out of the city is to stop renting and start building wealth in the form of real estate. But is purchasing a home “worth it?” What’s the return?

My take is that your primary home is not a financial investment but a cost of living. It’s a place to set down some roots and make memories. If the home does end up appreciating in value, that’s a cherry on top. The gains can often disappear over time after you adjust for inflation and subtract maintenance costs, interest and property taxes.

Liquidity concerns. For those currently renting: Would buying a house make you house rich, but cash poor? With a 20% down payment and another three to five percent of the sale price typically due at closing, where does that leave your bank account? Do you still have at least a 6-month rainy day reserve intact? If you lost your job soon after closing, would you be able to continue paying the mortgage? Now more than ever is not the time to shed liquidity if it means risking your emergency savings and financial stability.

The shift in expenses. Moving to the suburbs also doesn’t mean you’ll start saving loads of money. Yes, the price per square foot in our New Jersey town is a fraction of what it is in Brooklyn, and the move has meant we are no longer paying homeowners association fees, garage parking and private school tuition. Our nightly Seamless orders have also come to a halt.

But we have taken on new mega costs like higher property taxes, home maintenance and lawn care.

Keeping your home up to snuff is no small financial feat. Between our freezer breaking, a small flood in our basement and a patchy lawn, we’ve already shelled out thousands toward repairs in the first few months. Setting aside one to three percent of the value of your home could suffice for annual upkeep, but it’s wise to plan for more if you’ll want upgrades. With more people working at home these days, repairs and projects are having a “moment.”

Public or private schools? The reason our move hasn’t been a total wash for us is that we’re taking advantage of the town’s public schools.

The desire for a reliable and well-resourced school district is one of the biggest reasons families ultimately choose to leave New York – or any pricey city — and head for the suburbs. It is what Kathy Braddock, who runs the New York office for William Raveis Real Estate, calls, “the real cost saver” to moving. 

But whether this proves true depends on what you’re giving up. For us, we estimated a move and switch to public schools will save hundreds of thousands of dollars over the years, as our son had been attending private school in Brooklyn to the tune of $45,000 per year. His younger sister was on track to do the same.

When I last did the math, I decided private school dollars would be better saved or invested toward, say, college, retirement or helping my kids start a business one day. Yes, a good chunk of that’s now being eaten away by our new annual property taxes, but it’s still a substantial savings.

Plus, last year we learned that our son would require supplemental resources that his Brooklyn private school would not provide. In Montclair, we’d heard nothing but great things from parents whose kids had received special aid. This sealed the deal.

A new way of living. There is a small cohort of movers who quickly boomerang back to city living. “They didn’t do a good enough analysis up front,” says Braddock. “They went up on a June weekend and saw a house with a swimming pool and thought, ‘Isn’t this amazing?’”

Honestly, that can seem like a great reason to abandon a city right now, but down the road, assuming many of us return to working in high-rise offices, how will that daily 45-minute train ride, followed by 14-minutes on the subway, followed by an 11-minute walk to your desk, twice a day, every day, impact the quality of your life? Some may take advantage of that time to catch up on work, emails or rest. But others could find it intolerable.

Anyone considering a move should practice the suburban lifestyle as best they can before relocating. Maybe that means renting in the town for a year to test-drive things before purchasing. Over the years, we visited Montclair a number of times and stayed with friends. We consulted with a few real estate agents in the county and sought out the pros and cons from many colleagues who’d made the leap.

In the end, we trust we made the best decision for our family. But who knows, maybe we’ll return to the city as empty nesters, and finally have that long-delayed brunch.

This article was provided by Bloomberg News.
 

RELATED ARTICLES

Most Popular