Should You Build That New Home In That Older Baton Rouge Subdivision

Baton Rouge Appraiser Should You Build That New Home In That Older Subdivision

NOTE: My point is not to put down any particular subdivision in Greater Baton Rouge. My point is that it makes no economic sense to build a $160,000 new home in a 50 year old subdivision where the average non foreclosure home is selling for approx. $78,000 to $80,000 and average foreclosure is selling in the $40,000 range and 67% of 2012 sales were foreclosures. When you build such a home in such a subdivision, the home does not appreciate in value over time as much as if you built it in a subdivision with similar homogeneous new homes. And, the new home ends being only worth perhaps 67% of the total cost to build, +/-.

Subdivision Info & 2012 Home Sales

Average Home Is 1100sf to 1200sf

Approximately 50 Years Old

In 2012, 67% of Sales were Foreclosures

In 2012, Median Sales Price was $47,000

Non Foreclosure Sales Price Are $70,000 to $87,000

My advice is to simply ask a local real estate professional, Appraiser, if building this or that new home makes financial sense in the subdivision you want to build in.