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Housing Options

Team 11. Housing Options. Bryce Hagen Gamal Burhum Vesna Eng Danny Luu. Buy a Used Home or Build a New Home. A Comparison Based On Financial Conclusions. Scenario. Typical College Graduate First Time Home Buyer Southern California Residence Good Credit $300,000.00 Budget

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Housing Options

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  1. Team 11 Housing Options Bryce Hagen Gamal Burhum Vesna Eng Danny Luu

  2. Buy a Used HomeorBuild a New Home A Comparison Based On Financial Conclusions

  3. Scenario • Typical College Graduate • First Time Home Buyer • Southern California Residence • Good Credit • $300,000.00 Budget • 5.2% 30 Year Loan • Sell The Home After 10 Years

  4. Assumtions • 3.45% Inflation • 10.0% Real Estate Return • 10 year Analysis

  5. Used House Location • 2408 Ogden St. • San Bernardino, CA

  6. Used House Details • 3 Bedrooms, 2 Bathrooms • Family Room, Dining Room, Living Room • 2 Car Garage • 1396 Square Foot House • 8700 Square Foot Lot • Built in 1966 • $249,900.00

  7. New HouseLot Location • 2620 Kern St • San Bernardino, CA

  8. New House Details • 1400 Square Foot House • Built in 2004 • 9330 Square Foot Lot • 3 Bedrooms, 2 Bathrooms • Dining Room, Living Room, Family Room • 2 car Garage • Lot - $26,500.00

  9. Used House Initial Costs • $249,900.00 Purchase Price • $4879.00 Closing Costs • $531.41 Advance Payments • $1540.00 Title Charges • $385.00 Miscellaneous • $257,235.41 Total Initial Cost Sell the Home in 10 Years for $650,000.00

  10. New House Costs • $26,500.00 Lot Price • $196,000.00 Const. Costs • $16,800.00 12 Month Rent • $8,826.00 Fees • $5,000.00 Architect • $253,126.00 Total Initial Costs Sell the Home in 10 years for $720,000.00

  11. Used Home Maintenance Costs • $1,000 / year Maintenance • $9,500 Year 2,4 Plumbing Cost • $1,500 Year 3, Water Heater • $7,500 Year 1, New Roof

  12. New Home Maintenance Costs • $0 for the First 10 Years

  13. Present Worth Comparison • -$336,635.89 Total Costs • $277,591.17 PW of Sale • - $59,044.72 PWC New Home • -$370,048.62 Total Costs • $250,603.14 PW of Sale • -$119,445.48 PWC Used Home

  14. Sensitivity Analysis • Increased Construction Costs • $110 - $200 Sq Ft

  15. Sensitivity Analysis • Change in Used Home Price • $200k – 270k

  16. Internet Resources • www.builderonline.com – Home Building Tips and Warnings • www.home-building-directory.com – Instructions for Building and Contracting • www.toolkit.cch.com – Present Worth Analysis

  17. Buy a Used HomeorBuild a New Home Any Questions?

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