If you buy a house in a good neighborhood with good schools, your property values will likely trend up, even if they are higher to begin with.

If you buy a cheaper house in a bad neighborhood with poor public schools, you'll have to offset the monthly mortgage cost with private school tuition. This extra cost doesn't give you additional equity in your home, and there are no tax breaks like there are with mortgage interest.

In both cases, you'll have a place to live, and hopefully provide your kids with a good solid education. But if times get tough, you can always sell your house and reap some investment if it's in a good neighborhood. That is not always the case in a poor neighborhood.