Home (and School) Buying Simulation Name __________________
Ed 308: Cities, Suburbs & Schools by Jack Dougherty and Rachael Barlow, Fall 2011
Given a demographic profile of a Hartford family, how would you obtain information and make
decisions about buying versus renting in the city or surrounding suburbs, and the type of school
your child would attend?
This simplified role-playing scenario is designed to simulate the experience of buying a home
(and therefore buying access into certain public schools), and to deepen our understanding of the
relationship between housing policy and educational policy in the United States.
Questions you will face in this simulation:
1) Based on your family economic profile, can you afford to buy a home in the suburbs?
Specifically, how much of a home mortgage can you afford? If not, how much rent is affordable?
2) In which towns and neighborhoods does your income allow you to buy or rent?
3) Given your housing options, what types of schools can your children attend?
4) If you moved to a suburban residence, what additional challenges might you face?
5) If you buy a home, how much will the purchase actually cost (compared to your
6) Who wins and who loses under current US housing policies and practices?
Random Assignment of Family Economic Profiles
Each team consists of a family with the following scenario:
-- the parent(s) currently work and rent an apartment (or live with relatives) in Hartford
-- each family has two children (grades 3 & 6), currently in Hartford Public Schools
-- you have heard that “life will be better if you move to the suburbs”
Family Annual Monthly Savings Own a Monthly debt payments
profile Gross Gross (for down car?
Income Income payment)
1 $ 24,000 $ 5,000 No none
2 $ 30,000 $ 2,000 No none
3 $ 30,000 $ 5,000 Yes $ 100 car payment
4 $ 30,000 $ 5,000 Yes $ 200 student loan
5 $ 42,000 $ 2,000 No none
6 $ 42,000 $ 5,000 Yes $ 200 car payment
7 $ 42,000 $10,000 Yes $ 200 car + $200 student
8 $ 54,000 $ 2,000 No none
9 $ 54,000 $ 5,000 Yes $ 200 car payment
10 $ 54,000 $10,000 Yes $ 200 car + $200 student
11 $ 66,000 $ 5,000 Yes $ 500 student loan
12 $ 66,000 $10,000 Yes $ 200 car +500 student loan
Note: See current median family income for Hartford data at http://factfinder.census.gov
Step 1: Can you afford to buy a home? How much of a mortgage can you afford?
Use an internet mortgage site to find the current rate for a conventional 30-year fixed mortgage
For example, go to: http://bankrate.com/ Current rate __________
Use an internet mortgage affordability calculator to estimate the purchase price of a home you
can afford, based on lenders’ income and debt guidelines for a conventional 30-year mortgage at
the current interest rate (see above). For example, go to this CNN Money affordability calculator:
Write your answers in the boxes above. For additional reading, see US Department of Housing
and Urban Development (HUD) “Buying a Home” website:
Also, calculate your rent affordability as 33% of your monthly gross income: ____________
Step 2: After you have identified your affordable price range for buying and renting, start
hunting on the internet or newspapers for actual residences in suburban towns. Remember that
the space must house parent(s) plus two children (meaning 2 bedrooms minimum, 3 ideal).
Residences for sale that you can afford:
Town Address Purchase price (asking)
Rental homes or apartments that you can afford:
Town Address Rental price (monthly)
Step 3: Mortgage payments and Amortization schedule
Select a home for sale for which a conventional 30-year mortgage would be affordable for you.
Use an amortization calculator on the internet to calculate the following info:
a) What will be the
estimated total of your
monthly house payment?
Note: This calculator shows
principal + interest only. A
more accurate estimate also
would include property
taxes and insurance.
b) Click on the “Show
button. How much interest
would you pay the lender
during the first year (12
months) of your mortgage?
c) What would be the total
interest paid during the 30-
year life of your mortgage?
d) Compare the total
interest paid over 30 years
to the actual cost of the
home (the principal). How
much more interest would
you pay than principal?
Step 4: Buying a Home means Buying Access to a Public School
Look back at all of your options for buying or renting that you identified in step 2.
Given your housing options, what types of schools can your child attend?
Select 4 different school districts where you can afford to live, and using all of the resources
available to you, describe what you know about the “quality” of education there.
District Info about Quality of Ed Source