Decatur Daily Democrat, Volume 44, Number 288, Decatur, Adams County, 7 December 1946 — Page 12

PAGE SIX

New Home The Better Buy On Today's Market Prices Less Than Reproduction Costs— G. I. Advantages "The priority ceiling prices on Etrstton Place homes set last spring by FHA still prevail In spite of increased cosUi and the lifting of OPA controls on building materials eice that time.'* said John R Worthnun. creator of Stratton Place. "The sales prices," he comment ed. "will remain as they are now and there will be no Increase dur ing the periods the homes are offered to veterans. .Men who aaw service in. World War II have first priority on the homes, and they cannot be sold to anyone else for a period of 3>> days after completion. There are other advantages In buying on today's market. A continued advance in building costs Is ripe* ted which will adJ to the cost of new home construction In the future. Richard L. Nelson, Chicago, noted real estate analyst, who ad drewed the recent state conven lion of the Indiana Real Estate Association in Fort Wayne, explained that be expected a further rise In building costs of 20% before the peak Is ranched. While Mr. Worthman and olher Realtors and Build era, feel that hie estimate is a

I fa SCHMITT HOMESTEAD TO BE RECONVERTED — The former Ruhmltt home, occupied by Mr. and Mra. Huberi Hchmltt and family for many year*, now a part of HI rat ton Plat e, la to lie converted for buxineu or multiple residence uxe. The houae and area immediately adjoining are reatrlcted according to the regulations of the aubdivlidon for special use. The Worthman Company is now negotiating for the conversion of the houae into a kpeciai building, with club and community facilitiea, combined with a high class restaurant for the serving of meals and lunches. “Stratton Inn" has been suggested as a name and is now under consideration. The extensive basement is ideal for recreation, lounge and serving room purposes. The partitioning walls are to be removed and the basement modernized in keeping with desired facilities. The house is also considered remarkably well adapted for convralon for other purposes, including multiple fsmlly units. The home is unusually well constructed and spacious. It has six bedrooms, t-hree bathrooms, a study and breakfast room. There is also a large screened In porch and terrace. The heating plant Is forced hot water. There are fireplaces In both the living room and basement. . . ]

World War II Vet Advantages Outlined Financing Easier And Interest Lower A careful analysis is prepared In table above entitled "Should I Buy Today ” Let us compare the present to the period after World War I to 19.10. Under the G. I. laws today a veteran may purchase a home, (within his ability to pay) with a very small down payment and get a deed to the property. In addition he Beta a 11000 mortgage nemption on local taxes ravin* about (30.900 per year. Mo.-eover, with a deed the purchaser Is more secure. In the 20's It required 40% cash down payment to xet * deed or 10 to 20% down on a contract. All-Time Lew In Interest Today Interest rates on the mortgage is at 4 to 4%” (an aD-tlmo low) computed monthly on ths remaining balance of principal. First years Interest on this O. I. portion of loan hi in effect cancelled by crediting it against the principal. In the 1920 s Interest was 7 to 0%

oa first and second mortgagee. On today are all In favor at the buyer.

STRATTON PLACE EDITION

trifle extreme. It la generally believed that there will be a rise of 10 to 11% over present prices. There Is no doubt that there will lie some increases in the coat of building materials, making It Impossible to reproduce homes like 1 those now In Htratton Place ready for the market without an Increase i In price. Old Homes Cost Higher New homes whim are well built by skilled craftsmen and of quality materials, while reflecting a substantial Increase in price over the pre-war yean, are considered a good buy and the cost well within reason as compared with general prices. In fact It la not in new homes, but in old homes, used homes, where the prices have become inflated and have skyrocketed out of reason. Most everyone can point to old homes whlcb have doubled In price or more, an increase of 100% or more, during the past 4 or 5 years. New homes have shown no ouch Increase in price and are therefore considered the much better buy. Mr. Wortbman saya that homee being completed in Stratton Place ere priced at approximately 50% above pre war. Roy Wenzlkk. nationally known real estate analyst In St. Louts; James C. Down, president Real Estate Research Corporation, Chicago. and other men whose business it la to know and analyse the factors of the real estate market, unanimously point out tbat the price of new homes today generally are 10 to 30% less than old ones. It is the price of the old homes selling on today's market tbat is out of line and not the now homos

contracts it was never less and ' usually more. In comparing the contract plan which was the most commonly used we find the interest computed each six months instead of monthly. With the 7% higher rate,* considerable more money was ultimately paid for the home and the monthly payment was about 50% higher than today. The taaes, insurance, and assessmenu were an added outlay. Mortgages were usually made out tor five years duration In lieu of the 15 to 25 now prevailing. Thus added expenses were incurred In renewing the mortgage plus the concern whether It could bo renewed with out lump-sum reduction of the principal. Con-anient Monthly Payments Today mortgage payments are low, extending over 15 to 21 yean and invariably include taxes and Insurance: interest and principal. Usually a homo buyer Is paying a federal Income Tax on which ho may now take a deduction credit for the amount of the mortgage interest paid out for the year. His rate is not lass than 25% so at least H of the amount of intersot Is saved on bls Federal tax bill. This Interest credit cannot bo need If renting In other words, the advantages

SHOULD I BUY OR RENT? ■I Study This Comparison Chart For I Items Usually Overlooked I A comprehensive analysis originated by John R. Worthman, Inc. and adjusted for Decatur, Indiana. BE SURE TO READ THE IMPORTANT COMMENTS BELOW CHART I • si Purchane based on only 1500 down. However, for every 11000 additional paid down wil* reduce cash outlay approximately 66.00 per month under col. 8 in chart. I • 500 ! CASH°DOPN CROSS ANNUAL CASH OUTLAY »*»«•• NIT CASH OUTLAY WHILE BUYING ANNUAL SAVINGS GRAND lord 8000 balance t— — — -- “ 1 outlat for — 'l ..JHIKbI CARRIE) OS Aa) TEAR 90W6AOE IBWh«« mIM4Tro 00 UORTOAOE AFTER DEWCTIOX BANK NOUK rfSiOK "" V4L uomaoz m mctio. 000 IKmw ria. ard om „ imnn yng principal ASIWAU.T IMIS M A atquißW cantiT or COL. t .Hu.fiL rertixq pmjiicipil totals I SEWBICE Anmal BUwiee aercrw If 111 Mt. WA COL’S < HMIU TU ppg COL, fl lUUIU!!r~ **se is Me Ort. II Uss or COL. 2 COL.M OF YEARt of Mortgage aosrsn I tkroilCT sun uiar. «•»-<-» »TI rtt _____ IK)ll ' niLlf CsfflgfW.f —» °* l '* _ ™J’ ‘ J I AT IMt ID OF- COL. 1 ta . 2 COL. 3 COL. 4 (BU 5 COL. 6 CM. 7 COL. 3 COL. 9 OX. M) OX- II OX- 13 OX- 1? OX- n mt, u j Ist year 7,747.31 202.02 304.02 21.90 ROBE 029.34 90.71 03.49 46.00 040.03 910,00 278.37 202.02 01?.99 54?. 2nd w 7,403. 17 204.21 343.33 21. 50 00.00 709.30 86.3209. 12 01.97 023.04 810.0< 192.40 204.21 456.61 m.lj 3rd • 7,206.02 276.36 331.09 21.90 00.UO 739.34 92.79 69.12 62.32 620.86 810.OC 189.46 270.36 405.80 |,«so.«J 4th » 6,917.79 299.03 319.41 91.90 90.00 709.34 79.61 69.12 62.48 629.73 816. 00 106.27 289.03 475.30 1.945.? J 6th a 0.816.47 302.32 306.12 91.90 90.00 709.34 70.29 99.12 63.70 033.06 016.0 C 109.94 302.32 486.26 2.411. if 6th »6,899.84 919.83 891.21 81.90 90. 00 709.34 78.9199.18 93.09 939.99 916.00 1 79.4 7 916.9 9 495.70 2.906. M 7th s 9,999 .9 0 330. 74 276. 70 81.90 90.00 709.34 09.19 99.13 63.36 040.16 816.0 C 176.04 830. 74 6 06.58 3.411.11 Oth s 6,68'2.56 346 95 261.49 21.90 90.00 709.34 96.36 69. U 63.67 643.96 816.01 172.04 3 46.9 6 617. 99 3.331. M Oth w 6,200.71 361.84 246.60 21. W 00.00 709.34 01.4009. 12 64.00 647. f 4 916. 04 100.06 301.84 529.30 4.461.1i| 10th » 4.083.27 378.44 239.00 81.90 80.00 700.34 67.26 69. 12 64. 34 662.09 816.00 163.9 1 378.4 4 648.36 5.00J.4<| 11th * . 4,496.44 396.03 211.61 31.90 '90.00 709.34 62 .90 69.12 54.71 630.44 016.0( 100.06 396.03 565.31 5,553.1 j 12tb • 4,072.43 014.01. 109,43 21.90 80.00 709.34 40.36 69.12 66.09 080.90 816.UC 186.03 414.91 569.04 6.117. tj IJth * 3,639.39 433.04 174.40 81.90 80.00 703.34 43.60 68.12 66.48 666.74 016.0(1 100.86 433.04 383.3( 6,71i.2ff 14th 3.186.46 *62.93 21.90 00.00 709.34 36.6369. 12 56.00 070.71 016.00 140.01 402.03 698.22 7,301.41 BO,Ot> *•<» '2,211.11 <06.61 IH.O 0 01.00 00.80 709.34 27.00 60. 12 66.76 681.36 816.0 C 134.64 406.6 1 630. 16 8.653.4? _L-_. 1.600 .04 610 .86 80. 10 21.90 80.00 709.34 28.30 69.12 67.26 637.04 816.00 129.86 618.26 647.21 9,2J0.1j| |r* th * 1,166.08 642.06 66.38 81.90 60.00 700.34 16.36 69.12 67.76 692.99 810.00 123.01 042.06 660.07 ___JMOS i ?W piU 1 *■*£•■* •••»•• « tf ’ ou 49 10.11 69. 12 66.1 Q 699.23 aIQ ,00 11M.T7 666.99 683,76 [froth (FINO .00 689.99 14.42 81.00 113.00 738.31 3.61 61.62 CI.L2 734.60 816.0 C 01.40 689.00 671.28 li.o2»>»?>J TOUL9 .00 8,000.00 6.146.69 0 30.00 1.562.00 14,136.69 1,036.49 13,090120 16,320.00 3.220.00 9,000.00 11.220.80 11.220-80 **-*.* • i , a . »,♦• , * SUMMARY OF CHART COl • *’OR PROPERTY’ MAINTENANCE COSTS, we anaurne. wi>l equal the ex11 116,320.00 in total cont of renting for 20 years @ 16A.00 monthly P*nse of frequent moving which occurs at hast every 5 yearn and involves time tost, wear on your furnishings, and many other living adjustments 10 13,09920 is total cost outlay of owning @ $54.58 monthly 7 DEPRECIATION will be offset by long-range Inflation. History ha5 3,220.70 b difference in net cash outby proved that the property should STILL HAVE THE ORIGINAL MAR- „ A KET VALUE OF 18500.00 OR MORE WHEN 20 YEARS OLD. To con 2 8,000.00 add for mortgage being paid while owning vince yourself, cheek back in your neighborhood and you will find I hat the Romen have invariably so>d for as much or more than they cost 20. 40 or 15 611,220.80 60 years ago. 2,920.80 deducted for 20 yean depreciation at 2% per year on FURTHER SAVINGS could be shown by estimating the potential refund original now house there valued at 67,300.00 (without J® owners of hb portion of unused FHA Mutual Mortgage Insurance. We have shown interest rate at V/t'i which includes of 1% gom* (o ,n tot). However, please note below how depreciation b FHA Mortgage Insurance Group Account from which FHA draws for Ito offset. .. operating expenses with babnee Os the account to be refunded when the mortgages in the Group Account have been paid off. To date FHA has 6 8,300.00 Is TOTAL NET SAVINGS for 20 years. IN BRIEF taien of I<% to operate. AN INTEREST SAVING could also be Th. Hom. Hu Co.t You Nolhlu,. J* V ""“" • »•« «<«<l ««« «' «"< SO WHY RENT? ■ ■ ' * , ■ ■• . • The chart shows undbputabte economic benefits of owning your ’ we fail to see how any future general towering of market values will ever home. Besides that aspect, much could be said about benefits of home. come near catching up with the balance on this type of monthly leducing owning for creating more civic minded and atabb citizens, the pride of mortgage. Remember that 2Vi to 3 times your annual combined income ownership, community standK M and better enjoyment and security to should be the limit for the purchase price of your home unless you have a your family. Compare the financial status of your acquaintances, those subatantbl down payment. Other savings to original purchasers are who for 20 years have been renting and those who have owned their home. made through construction methods as detailed elsewhere in this paP* r With building costs, along with other general prices and wages being J in articles captioned “Merchant Builder” and “New Homes the Better reliably predicted to go up another 15% to 25% before they start Uriu Buy.”

DECATUR DAILY' DEMOCRAT, DECATUR, INDIANA

SATURDAY, dec. 7, ,1