Irvine Housing Blog

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Buy or rent at Liberty in West Irvine Posted: 15 Feb 2012 04:00 AM PST 26 Bowie Pl is a 4 bedroom, 2.5 bath single family detached home in the Liberty tract in the Independence section of West Irvine.  Click the picture below for a closer view.   There are three main floor plans in the Liberty tract and at 1,755 square feet, 26 Bowie is the middle plan. There are two other Plan 2's on the market that are in the Accepting Backup Offers status: 111 Confederation - Listed at $571,700 31 Halifax - Listed at $549,000 As far as Plan 2 Closed Sales, I found these: 9/23/11  155 Church Place $585,000   9/19/11  162 Church Place $585,000   Given the actual closed sales and the status of the two accepting backup offers, I'll use a price of $570k for the analysis. Purchase Price $570,000     Closing costs $17,100 3%   Total price $587,100             Down payment $131,100 20%           Loan Amount / Percentage Of Price $456,000 80%   Interest Rate / Period (months) 4.00% 360             Monthly Yearly   Mortgage Payment $2,177 $26,124   Interest Component $1,520 $18,240           Property Tax $503 $6,039 1.06% Special Assessments $96 $1,147 0.20% Effective Tax rate     1.26%         Insurance $50 $600   HOA 1 $0 $0   HOA 2 $0 $0           Cash Out $2,826 $33,910   There are some possible adjustments that may apply to your situation.  Be sure to also consider how long you may own the property (average is around 6 years), what kind of financing you actually qualify for, how much you put down, the effect of giving up the standard deduction, potential price declines, costs to sell the property, etc.  The NY Times Buy or Rent calculator is a great tool that helps with some of these. Possible Adjustments       Interest paid   $18,240   Property tax   $6,039   Total deductible   $24,279   Tax benefit $506 $6,070 25%         Opportunity cost of down payment -$219 -$2,622 2%         Principal paid in mortgage payment $657 -$7,884   What do these Plan 2s rent for?  I didn't find any recent closed leases for Plan 2s.  There is a Plan 3 (~2000 sq ft) at 27 Halifax which is asking $2650/month. Would you buy 26 Bowie for $570k or rent it for $2650/month?

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