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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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Presentation Transcript
housing options

Team 11

Housing Options

Bryce Hagen

Gamal Burhum

Vesna Eng

Danny Luu

buy a used home or build a new home

Buy a Used HomeorBuild a New Home

A Comparison Based On Financial Conclusions

scenario
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
assumtions
Assumtions
  • 3.45% Inflation
  • 10.0% Real Estate Return
  • 10 year Analysis
used house location
Used House Location
  • 2408 Ogden St.
  • San Bernardino, CA
used house details
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
new house lot location
New HouseLot Location
  • 2620 Kern St
  • San Bernardino, CA
new house details
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
used house initial costs
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

new house costs
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

used home maintenance costs
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
new home maintenance costs
New Home Maintenance Costs
  • $0 for the First 10 Years
present worth comparison
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
sensitivity analysis
Sensitivity Analysis
  • Increased Construction Costs
  • $110 - $200 Sq Ft
sensitivity analysis15
Sensitivity Analysis
  • Change in Used Home Price
  • $200k – 270k
internet resources
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
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