View Single Post
Old 11-14-2020, 10:23 AM   #15
Winilyme
Senior Member
 
Join Date: Oct 2019
Location: Ice in = CT / Ice out = Winnipesaukee
Posts: 431
Thanks: 100
Thanked 262 Times in 139 Posts
Default

Quote:
Originally Posted by Formula260SS View Post
I don't doubt you, I'm only trying to figure out how the numbers work - this is not an argument by any means at all.

A close friend just sold a pretty high end home in Londonderry where I live. Selling price was 750K, the land is worth I'd say 150K so that gets me to a house only price of 600K. The house is 3000 sq/ft, if I divide the 600K by 3000 sq/ft I'm at $200.00 sq/ft on the upper end of the scale.

If I give the land a higher value it drives the house sq/ft price down, if I add the sq/ft of his finished basement that also drives the sq/ft price down

Again I don't disagree with you I just can't see how the numbers would work. If your building a house and using a bank it's all got to balance out. At least that's how my brain works.
Unfortunately, the math doesn't work that way. If you find an exact duplicate of that 150K lot and build an exact replica of that 3,000 SF house, it's generally going to cost you more to build than it would to outright purchase the home you're copying. That's part due to depreciation and the fact that, over time, cost of materials and labor increase.

As another point of reference, your homeowners premium may be based on a home rebuild value that significantly exceeds what you could sell the home for.

I say purchasing a resale is the way to go. You are more likely to get what you want, where and at a more reasonable cost. And throw some of the money saved into some renovations to make the home even more perfect.
Winilyme is offline   Reply With Quote