What Can You Buy For $650,000?

So although we bemoan the high cost of housing in Anchorage, it sometimes helps to put it in a little bit of perspective. In Austin, Texas, near the University of Texas campus, you can buy a 1,200 square foot renovated l950’s home for $635,000.  Taxes are $9,588.  In Philadelphia, you can purchase a former carriage house built in l932 with three bedrooms and two bathrooms for $650,000. It has 1,755 square feet.  Taxes were $5,851 in 2017.  In West Stockbridge, Mass. you can purchase a 2,381 square foot home priced at $273 per square foot.  Taxes are $5,637.  In Anchorage, you can purchase a new $659,900 home with 2,887 square feet.   Taxes are estimated to be $9,748 per year which may or may not have a slight decrease in the $300 to $400 range depending on whether or not Proposition 11 passes.   Regardless of the passage, however, Anchorage does appear to have some of the highest residential property taxes in the nation.

Currently, twenty-six single family homes in Anchorage are available through the local MLS ranging in asking prices from $609,500 to $699,900.  Six of these listings are ‘to be built’. In other words, there is currently no building permit for any of these homes.  They are place holders on lots and are marketing as a home that can be customized to a buyer’s tastes.  The twenty remaining homes range from 2,300 square feet for new construction to over 5,600 square feet for a home usually  built in the 1980’s.  Lot sizes range from 6,000 square feet to over 65,000 feet.

There is probably no better area of the market that demonstrates the disconnect between an older home with more square footage  compared to a brand new home with 2 x 6 construction and built to five star energy standards.   Buyers have to decide between more living square footage and ‘room to roam’  versus the benefits of brand new with no unexpected maintenance and repair costs.  Regardless of the decision of new vs. pre-owned, homes in this price bracket remain relatively affordable on a price per square foot basis.  Financing in this price range is also attractive. VA  loans allow 100% financing of the purchase price and closing costs amount to $14,000.  Ask a seller to pay for closing costs and a veteran with good credit can purchase  a $650,000 home without any out of pocket expenses except the cost of the Uhaul.   Other loan programs with a modest down payment will waive the dreaded mortgage insurance monthly premium.