Quote:
Originally Posted by C. C. Rider
Just doing some "back of the envelope" calculations, that doesn't sound very profitable to me. It seems to me that a brand-new house of the same size and quality would have to increase in price about 16% to 18% per year just to break even on the deal... not counting anything for your time involved. Making a profit on the deal would require an even greater price increase year-over-year.
I know that housing is becoming more expensive every year, but is it actually increasing at 25% or more per year which is what I figure it would take to make it worthwhile?
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We bought a new patio villa in 2019, sold it just shy of 2 years later for 70% more than we paid for it and had it rented unfurnished the entire time. The rental income covered all of the costs to own the unit so the 70% was all profit plus the positive income while rented. At this point, 2 years later, that same unit would sell for just about what we sold it for in 2021 so it's a matter of timing and mostly luck.