Don't get me wrong, it is a lovely property, but the seller bought the property for $455K in June 2004. They want to sell it for $749K so assume that they get asking price they would gross $696.5K (assuming 6% commissions and 1% closing costs). Net the loan and we are looking at $241.5K for holding the property 5 years.
Being extremely generous and assuming that they put 20% down and a 6.5% loan they most likely have $91K in down payment and payments of $166.5K in principal + interest and insurance. Total cash in is $257.5K. Their return is 93.8%!
A new calculation that I am using is that if they sold it at that price their housing expense for the time they were there would be $257.5K - $241.5K is $16K for the entire 5 years. That would mean that if they were renting instead of owning for the last 5 years their expense would be $267 a month! Compare that to average rents in the area for $3000 a month and they would have been getting a bargain.
It is assessed at $577K. At this price they would be paying $2,664 a month in rent which I think is reasonable.
I think the assessor is right on this one for $577K, and may be generous at that price. What do you think?