I have a pretty good gig. Recently, I've been helping friends of mine, a family with two young kids, find a home in Chicago... or close by. The catch is, they'd like to be in an area with "things to walk to".
This is personal. They are not only friends but they are in a very similar point in their lives as my wife and I are. They want a cool neighborhood and just a little elbow room. They don't want to mortgage their lives.
Luckily, Jillian and I pulled it off a couple years ago. We will soon be a family of four and have a nice duplex home we'll enjoy for a long, long time. Sure, Ryne (pictured above) basically plays in a parking lot out back. But so did I growing up and that worked out okay.
It can be done. I just read in the latest Dwell magazine about a couple with two kids living in a great Manhattan location who renovated their... get this... 700 sq/ft home to accommodate the new baby (the 4th family member). So, I got a little embarrassed knowing I've once felt like 1800 sq/ft was not enough. It's all about the layout and location (and adding storage).
That said, for many it's really hard to imagine having a couple kids in a three bedroom condo (with a family room please). But it only takes a little thinking about how you live life and what you want outside your door. So, if you want to live in the city... live in the city and make it work. Don't think you're supposed to have a house somewhere far, far away where you clean the gutters and mow the lawn rather than take the kids on the Brown Line to Millennium Park on a Saturday morning.
Now, to find that city home for a family of four in a good loaction for around $350,000... I'm open to suggestions.