Ventas de casas

1 Taking into consideration the fact that the $98,000 home price will grow at 4% per year, what will be the future median home selling price in Lakewood in eight years? What amount will Kate Myers have to accumulate as a down payment if she does decide to buy a house in Lakewood?

PV $98,000.00

n 8

i 4%

FV -$134,119.77

DP -$26,823.95

2 Based on your answer from number 1, how much will have to be deposited into the Merrill Lynch account (which earns 8% per year) at the end of each month to accumulate the required down payment?

MONTH

FV -$26,823.95

I 8% 0.67%

N 8 96

PMT $200.38 PER MONTH

3 If Kate decides to make end-of-the-year deposits into the Merrill Lynch account, how much would these deposits be? Why is this amount greater than twelve times the monthly payment amount?

FV -$26,823.95

I 8%

N 8

PMT $2,521.85 PER YEAR $2,404.50 MONTHLY PMT

She ends up paying more cuz of the acumulated interest.

4 If homes in Lakewood appreciate by 6% per annum over the next eight years instead of the assumed 4%, how much would Kate have to deposit at the end of each month to make the down payment? What if the appreciation is only 2% per year?

PV $98,000.00 MONTH

n 8 FV -$31,239.42

i 6% I 8% 0.67%

N 8 96

FV -$156,197.11

DP -$31,239.42 PMT $233.36 PER MONTH

PV $98,000.00 MONTH

n 8 FV -$22,964.52

i 2% I 8% 0.67%

N 8 96

FV -$114,822.62

DP -$22,964.52 PMT $171.55 PER MONTH

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