New Construction... A better investment?
Posted under: Home Buying in Redmond
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March 13, 2009 4:00 PM |
148 views |
5 comments
As a site agent at CamWest’s Tyler’s Creek in Redmond, I would like to share some recent activity our neighborhood has seen and tell you about some fantastic incentives CamWest is offering on their remaining homes.
Over the last three weeks, we have had five offers, three sales and are now over 80% sold out in our cul-de-sac style community of 90 homes!
Our home of the month, the Lopez floor plan on lot #52 features 3 bedrooms, 2.5 bath, bonus room and 2489 sq ft , now priced at $569,950! This home includes the luxury appliance package with stainless steel appliances and a front load washer and dryer. There is no other community in 98052 with a single family residence this size at this price.
CamWest is now offering a limited financing rate of 4.25%! This is a 30 year fixed, conventional loan with 20% down. If 3.5% is a better down payment, they also offer a 4.5% 30 year fixed FHA loan!
While many buyers are wrapped up in short sales, and bank owned homes, it is important to remember new construction prices are aggressive and competitive and are able to offer some fantastic financing and warranty for 10 years! Also, new construction homeowners do not need to worry about previous deferred maintenance and get a move in ready home.
Visit http://www.camwest.com/WF/community/community.asp?commid=1041 for pictures and information on this fabulous community!
Over the last three weeks, we have had five offers, three sales and are now over 80% sold out in our cul-de-sac style community of 90 homes!
Our home of the month, the Lopez floor plan on lot #52 features 3 bedrooms, 2.5 bath, bonus room and 2489 sq ft , now priced at $569,950! This home includes the luxury appliance package with stainless steel appliances and a front load washer and dryer. There is no other community in 98052 with a single family residence this size at this price.
CamWest is now offering a limited financing rate of 4.25%! This is a 30 year fixed, conventional loan with 20% down. If 3.5% is a better down payment, they also offer a 4.5% 30 year fixed FHA loan!
While many buyers are wrapped up in short sales, and bank owned homes, it is important to remember new construction prices are aggressive and competitive and are able to offer some fantastic financing and warranty for 10 years! Also, new construction homeowners do not need to worry about previous deferred maintenance and get a move in ready home.
Visit http://www.camwest.com/WF/community/community.asp?commid=1041 for pictures and information on this fabulous community!
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Comments
I get that number by the following calculations: 569950/10/7.41 is roughly 7692. Stated another way, the investor would be purchasing these properties at a cap rate of 10%--which of course isn't likely to happen there (especially for new homes) due to the rental comps in the area.
New construction single family homes are not intended to be rental properties. They hold value as an "investment" for resale, as an owner-occupied home. The quality of materials, finishes, and construction are too expensive for immediate rental purposes. Yes, the buyers are paying a premium over rent, so that they can own the home.
Apartment buildings are built faster, cheaper, and with lower end finishes to make them attractive investment properties. Cap rates are great when applied to apartments.
By my calculation, Mortgage $569,950 (assume with no down payment)
interest rate 4.25%, with 30 years term.
Monthly mortgage payment is $2803.81, Property tax per LA, California is $569.95( monthly), insurance and maintenance is $250.(monthly)
$2803.81+$569.95+$250. = $3,623.76 ( total )
I checked on realtor.com, if you rent the older house with 2,400 sqrt, avarage price is $2,400.
Differential is $3,623.76-$2,400. = $1,223.76
Factor with the tax rebate, still you pay around $900 more a month for from the renter to be the home owner.
However, It's different from Dp2's calculation ( $7,692 )