Question: Post below by John Walker
"After all is said and done, the final and only issue that a buyer needs to consider when deciding between a home located in a Mello-Roos District (or any other special assessment district, for that matter), and one that isn't, is: how much down and how much per month for an essentially equal home offering the identical value. If the monthly payment is the same for either, then it's a wash. Whether the payment is skewed toward high principal and interest, with lower taxes on one, or the payment is skewed toward lower principal and interest, with higher taxes on the other, it's still the same monthly payment"
In some parts of San Diego, Mello Roos are upwards of $4,500 per year. If $700K can buy you one house with Mello Roos and $750K could buy you another without, wouldn't that make more sense, all things being equal, to buy more home and still pay out the same in monthly payments? Get more home, deduct more mortgage interest, while keeping your payment the same?
Therefore, wouldn't it make sense, if you have "X" dollars to spend each month, to factor in the difference in mortgage interest deductions you can take if buying a home with or without Mello-Roos? To me, not being able to deduct that portion of your tax bill, buys you more home and ultimately allows you to deduct more mortgage interest, therefore giving you more bang for your bottom line buck..
Am I missing something? Just wondering what your thought was on that one? Thanks!