Book suggestions 2nd grader reading at 7th grade level...

Half Magic
Mr. Popper's Penguins
The Mixed-up Files of Mrs. Basil E. Frankweiler
The Secret Life of Dilly McBean

Biographies like:
Anna and the King of Siam
Cheaper by the Dozen (there are a number of books after this, too)
The Story of the Trapp Family Singers

Redwall series by Brian Jacques
JUst an FYI depending on how strict you are that Cheaper By the Dozen does have some swearing in it. Not much, but there is some.
The Type One Super Robot by Alison Prince

Any Jerry Spinelli novels

Hatchett and the sequels by Gary Paulsen

Crispin....by Avi....any books by Avi
Agatha Christie mysteries

A Tree Grows in Brooklyn by Betty Smith

The Pushcart War by Jean Merrill

The Twenty One Balloons by William Pene du Bois

Bud, Not Buddy by Christopher Paul Curtis.
I would be careful with Avi too. Most of his/her :confused3 books are awesome but there are a few with more mature themes.
We are christian, and I don't find them to be a problem. They are after all based in a fictional world. I feel it is important for children to realize that not everyone believes as they do. I might screen the last 2 books based on the maturity level of the child, but I would think tha a mature 9-10 year old would be fine with them. A child who is easily scared, mabye not.
I think that more than the content of the books themselves, it is the author who is controversial in Christian circles. Phillip Pullman has stated in interviews that it is his goal that no child in America believe in God. I know I am mistating that a bit, but he is an atheist who is very anti-religion.
 
The Mixed-up Files of Mrs. Basil E. Frankweiler
Wrinkle in Time
Hardy Boys series
Boxcar Children series
Judy Blume's Fudge / Super Fudge
Phantom Tollbooth
Great Condomunium Rebellion
 
Great suggestions here - we have also struggled with the same issue for years since DD10 is advanced - trying to balance appropriate content with appropriate reading level. DD is so excited to be going to middle school because she had read all the books in our school library by third grade. I agree with the PP who said there is nothing wrong with reading some books at grade level, not always reading at reading level. DD breezes through the 39 Clues series but still enjoys reading them. DD7 still enjoys Junie B. Jones even though they are below her reading level. Sometimes it's nice just to read for fun instead of reading for the challenge (not that you can't do both).

A few I didn't see mentioned:

The Inkheart Series by Cornelia Funke (Inkheart, Inkspell, Inkdeath)
Other Cornelia Funke like Dragon Rider and the Thief Lord
Someone mentioned the Among the Hidden series - Margaret Peterson Haddix has so many books DD has loved - Found, Sent, Running Out of Time, as well as the whole Among the Hidden Series
The Kingdom Keeper books by Ridley Pearson (set in Disney!)

DD started reading Peter and the Starcatchers in second grade (someone else mentiond that) - there are now four books in the series.

Has he read the classics - Stuart Little, Charlie and the Chocolate Factory, James and the Giant Peach, Charlotte's Web?
 
here's a suggestion for enabling happy readers.... I have always taken my kids to the library regularly,and I let them pick out ARMFULS of whatever books catch their eye....then they have a huge pile by the bed for picking and choosing...usually, they like a few the best,then we proceed to look for more by the same author,etc. Also the librarians are usually great for advising on similar titles.........I do the same thing,I like to have 2 or 3 spares in case I don't like what I'm reading.......
 

side note,I love most titles by Avi, he's excellent with historical fiction....
 
We've done a lot of the Boxcar Children and Magic Tree House books for DS. He can get through one an night, but he LOVES to read, and I think that for recreational reading, that is fine. We do choose biographies, as well, but at this age, I really want to instill a love of reading in him that will last his whole life. We have also explored the following:

My Father's Dragon
Mr. Popper's Penguins
Charlie and the Chocolate Factory
Sounder
Where the Red Fern Grows
Wayside School series
Indian in the Cupboard
Rober Newton Peck's books
Great Brain series - these and the previous one are Laugh-Out-Loud funny!
Johnny Tremain
The Bronze Bow
Cheaper By the Dozen
Caddie Woodlawn
Homer Price
Narnia Series

Sometimes DS will ask me what a word means, and other times we will discuss the story in general. I find it makes great conversation fodder for the dinner table. I agree though, that it is hard to find things that will challenge him without having content that is too mature for a 7-year-old!
 
I've generally chosen older books (say, 1950's and before) for the great vocabulary and imagination.
I know they may be a bit easy, but have you had him read the original Winnie the Pooh yet?
Maybe see if you could get an anthology book with excerpts of classic kids books (Peter Pan, Wind in the Willows types) to let him choose what he likes.
In a few years, you may look into The Hobbit, but he may be ready to read books like " The Secret Garden", "Daddy Long Legs", "Rebecca of Sunnybrook Farm", and "Pollyanna" now. Also, "Alice in Wonderland" and "Alice through the Looking-glass", "Jungle Book", and "The Five Little Peppers".
Shy away from the original "Gulliver's Travels" - Not for kids! :(
Have you looked into a book of lists . . . like "Honey for your Child's Heart"?
 












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