(MONEY Magazine) – When Emmett Steed, 39, accepted a job as vice president, operations controller at the headquarters of the Red Lion Hotels & Inns in Vancouver, Wash. last April, he and his wife Jana, 37, faced the decision that confronts every family relocating to a new town: Where should we buy a home? For the Steeds, who were transferring from Phoenix, the obvious first choice seemed to be Lake . Oswego, the prestigious Portland, Ore. suburb, only a 25-minute drive from Vancouver. ''Several of the company's key executives live there, so that's where we looked first,'' explains Emmett. But after four days of house hunting and some meticulous number crunching, the Steeds bought their home in Vancouver. One important reason: by simply crossing the Columbia River, the border between Oregon and Washington states, the Steed family would save close to $7,000 in state and local taxes in the first year alone. For starters, Washington has no state income tax. Emmett figured that by living there instead of in Oregon they would pocket an estimated $4,500 in state taxes each year. Next, property taxes in Vancouver are based on a rate of $13 per $1,000 of assessed property value, which is roughly half of Lake Oswego's rate of about $25 per $1,000. That meant a $200,000 house in Vancouver would cost about $2,500 a year in property taxes as opposed to $5,000 in Lake Oswego some 20 miles away. Lastly, Vancouver offered not only a lower rate but also more house for less money. For $195,000, the Steeds bought a four-bedroom, 3,700-square-foot English-Tudor-style home in a new development. ''In Lake Oswego, 3,000-square- foot homes were in the $225,000 to $250,000 range,'' recalls Jana, who also liked the school system in Vancouver for the couple's three adopted children: Carrie, 10, Mark, 6 and Lisa, 2. The lower price meant a lower tax assessment and less debt: in Vancouver the Steeds needed a $50,000 mortgage as opposed to one for $100,000, which they would have been forced to get in Lake Oswego. That would save roughly $5,000 a year in mortgage payments, Emmett calculated. The Steeds' conscientiousness extends to their federal taxes as well. For years, Emmett had been diligently contributing to the profit-sharing plan of his previous employer, the Marriott hotel chain, and in July 1990, when he is eligible, he plans to start feeding the maximum to Red Lion's 401(k). Deeply religious Mormons, the Steeds contribute 12% to 13% of their income to the church and church-related charities, all of which they carefully deduct on their federal return.