Nov
28

Buying a New Home Vs Building One on Balboa Island

I’m often asked by clients about the pros and cons of building a new home vs buying a spec home (new construction).  It comes down to 3 main things: time, money and involvement. The numbers used below are about average for other areas in Newport Harbor as well. ~ Steve Roose with Luxury Real Estate

Buy a New Home on Balboa Island

This process is quite simple and straightforward. Find one you like and make an offer! Open escrow, complete your due diligence, arrange financing (if any), close and move-in immediately. Currently, new construction is selling for $3,500,000 and up for a standard lot size on Balboa Island. On a 30′ lot, you get about a 2,500 sq foot home. These homes tend to be 3-4 bedrooms with a roof-top deck and 2 car garage.

Pros of Buying a New Home on Balboa Island

  • Move-In Immediately
  • Finance with Ease
  • Plans & Permits already Completed

Cons of Buying a New Home on Balboa Island

  • More Expensive than Building – Approx $500,000 or more.
  • Higher Property Taxes – Property taxes based on the sales price (Higher than buying a lot and building costs combined)
  • Low Inventory – Few homes to choose from. In this market there are usually 0-2 new homes available at any given time.
  • Possibly Lower Quality – Due to Investor’s Profit Margin

Available New Homes on Balboa Island

Recently Sold New Homes on Balboa Island

Build a Home on Balboa Island

For the right person, this can be a fun project to save a lot of money and get exactly the home you want. Although it takes just over a year to build, we are typically in an appreciating market. The OC Register forecasts 5% appreciation next year. With the costs of land and construction being much lower than what new homes are selling for, you will walk into over half a million in equity on day 1. Many clients are unsure of the permit process, which builders do a quality job at reasonable prices, and so on. I recommend professionals that have been in the business a long time, they are efficient and have a history of quality and happy clients. The right builder/designer, just like any other professional, will save you time, money and headaches. Currently, lot value is just under 2 million on Balboa Island. You can expect to get a 30′ lot for about 1.8 million today. Due to all the new construction on the island, we are seeing less multi-family properties (duplexes) as they are being torn down and replaced with new homes. Over time, this will lower density. Most of my clients are able to build a new home for just over 1 million, depending on finishings. If you built for 1.2m you have a final product at only $3,000,000. That is $500,000 less than buying new and you are getting the home you want… down to every detail!

One of my clients will have her Lido Isle home completed in January. She paid 1.6m for the lot and is building for 1.1m, bringing her total to $2,700,000. I’d currently value her home at 3.6-3.7 million. That’s $1,000,000 in equity! If you don’t have another home to live in during construction, you could lease a property for a year and still come out ahead.

Pros of Building a Home on Balboa Island

  • $500,000 or more in Equity
  • Lower Property Taxes
  • Choose # of Bedrooms and Design Perfect Floorplan
  • Get the Quality and Finishings you Desire
  • Easily Add an Elevator

Cons of Building a Home on Balboa Island

  • Over 1 Year To Build
  • Lots of Decisions
  • Slightly Complicated Financing with Potential Rate Change Over the Year

Properties Available Near Lot Value on Balboa Island

  • I have an off-market option on Diamond at $2,000,000.

  1. 4 beds, 2 full baths
    Home size: 1,728 sq ft
    Lot size: 2,614 sqft
  2. 2 beds, 1 full, 1 three-quarter baths
    Home size: 1,233 sq ft
    Lot size: 1,200 sqft
  3. 2 beds, 1 full bath
    Home size: 660 sq ft
    Lot size: 2,550 sqft

See all Real Estate For Sale in 92662 zip code - Balboa Island.
(all data current as of 5/22/2017)

Listing information deemed reliable but not guaranteed. Read full disclaimer.

Recent Home Sales Near Lot Value

Balboa Island Real Estate

  1. 9 beds, 9 full, 1 three-quarter, 4 half baths
    Home size: 15,000 sq ft
    Lot size: 5.45 ac
    Year built: 1926
    Parking spots: 6
    Days on market: 111
  2. 7 beds, 3 full, 4 three-quarter, 7 half baths
    Home size: 17,000 sq ft
    Lot size: 12.47 ac
    Year built: 2014
    Days on market: 104
  3. 6 beds, 7 full, 2 half baths
    Home size: 10,000 sq ft
    Lot size: 20,909 sqft
    Year built: 1996
    Parking spots: 9
    Days on market: 38
  4. 6 beds, 7 full, 2 half baths
    Home size: 15,000 sq ft
    Lot size: 30,162 sqft
    Year built: 2010
    Parking spots: 8
    Days on market: 116
  5. 6 beds, 7 full, 3 half baths
    Home size: 9,478 sq ft
    Lot size: 13,504 sqft
    Year built: 2006
    Parking spots: 4
    Days on market: 173
  6. 12 beds, 11 full baths
    Home size: 8,065 sq ft
    Lot size: 24,829 sqft
    Year built: 1921
    Parking spots: 8
    Days on market: 2
  7. 5 beds, 5 full baths
    Home size: 3,920 sq ft
    Lot size: 22,545 sqft
    Year built: 1932
    Parking spots: 2
    Days on market: 84
  8. 5 beds, 5 full, 1 half baths
    Home size: 6,109 sq ft
    Lot size: 7,562 sqft
    Year built: 1991
    Parking spots: 3
    Days on market: 338
  9. 6 beds, 6 full, 2 half baths
    Home size: 8,315 sq ft
    Lot size: 13,552 sqft
    Year built: 2014
    Parking spots: 3
    Days on market: 347
  10. 4 beds, 4 full, 2 half baths
    Home size: 4,900 sq ft
    Lot size: 6,450 sqft
    Year built: 2007
    Parking spots: 8
    Days on market: 277
  11. 6 beds, 9 full, 2 half baths
    Home size: 12,780 sq ft
    Lot size: 21,553 sqft
    Year built: 2017
    Parking spots: 18
    Days on market: 90
  12. 7 beds, 8 full, 3 half baths
    Home size: 12,681 sq ft
    Lot size: 21,220 sqft
    Year built: 2011
    Parking spots: 16
    Days on market: 77
  13. 5 beds, 5 full, 1 half baths
    Home size: 6,339 sq ft
    Lot size: 19,200 sqft
    Year built: 2014
    Parking spots: 4
    Days on market: 167
  14. 5 beds, 6 full, 2 half baths
    Home size: 12,500 sq ft
    Lot size: 1.10 ac
    Year built: 2013
    Parking spots: 12
    Days on market: 17
  15. 8 beds, 9 full, 1 half baths
    Home size: 11,882 sq ft
    Lot size: 21,834 sqft
    Year built: 2008
    Parking spots: 20
    Days on market: 68
  16. 5 beds, 3 full, 2 three-quarter baths
    Home size: 4,388 sq ft
    Lot size: 12,495 sqft
    Year built: 1942
    Parking spots: 13
    Days on market: 39
  17. 4 beds, 4 full, 2 half baths
    Home size: 7,515 sq ft
    Lot size: 14,026 sqft
    Year built: 2010
    Parking spots: 6
    Days on market: 7
  18. 6 beds, 3 full, 3 three-quarter, 2 half baths
    Home size: 7,113 sq ft
    Lot size: 1.20 ac
    Year built: 1987
    Parking spots: 12
    Days on market: 102
  19. 6 beds, 7 full, 2 half baths
    Home size: 11,400 sq ft
    Lot size: 27,316 sqft
    Year built: 2001
    Parking spots: 16
    Days on market: 216
  20. 8 beds, 7 full, 1 three-quarter, 3 half baths
    Home size: 10,921 sq ft
    Lot size: 13,100 sqft
    Year built: 1988
    Parking spots: 12
    Days on market: 75
  21. 5 beds, 6 full, 1 half baths
    Home size: 5,850 sq ft
    Lot size: 14,000 sqft
    Year built: 2002
    Parking spots: 8
    Days on market: 11
  22. 4 beds, 1 full, 3 three-quarter, 3 half baths
    Home size: 5,500 sq ft
    Lot size: 8,712 sqft
    Year built: 2016
    Parking spots: 2
    Days on market: 205
  23. 3 beds, 3 full, 1 half baths
    Home size: 5,500 sq ft
    Lot size: 7,844 sqft
    Year built: 2004
    Parking spots: 4
    Days on market: 200
  24. 6 beds, 6 full, 1 half baths
    Home size: 5,989 sq ft
    Lot size: 10,332 sqft
    Year built: 1993
    Parking spots: 4
    Days on market: 81
  25. 5 beds, 6 full baths
    Home size: 6,500 sq ft
    Lot size: 7,000 sqft
    Year built: 1990
    Parking spots: 39
    Days on market: 14
  26. 5 beds, 5 full, 1 three-quarter, 2 half baths
    Home size: 6,836 sq ft
    Lot size: 9,583 sqft
    Year built: 2016
    Parking spots: 8
    Days on market: 26
  27. 9 beds, 3 full, 7 three-quarter, 2 half baths
    Home size: 19,346 sq ft
    Lot size: 2.10 ac
    Year built: 2001
    Parking spots: 12
    Days on market: 194
  28. 5 beds, 5 full, 2 half baths
    Home size: 10,900 sq ft
    Lot size: 18,400 sqft
    Year built: 2003
    Parking spots: 6
    Days on market: 346
  29. 7 beds, 8 full, 1 half baths
    Home size: 8,823 sq ft
    Lot size: 32,300 sqft
    Year built: 1992
    Parking spots: 12
    Days on market: 346
  30. 4 beds, 4 full, 4 half baths
    Home size: 8,350 sq ft
    Lot size: 16,280 sqft
    Year built: 2006
    Parking spots: 4
    Days on market: 54
  31. 6 beds, 5 full, 2 half baths
    Home size: 10,550 sq ft
    Lot size: 2.08 ac
    Year built: 2002
    Parking spots: 20
    Days on market: 28
  32. 5 beds, 2 full, 4 three-quarter, 3 half baths
    Home size: 10,200 sq ft
    Lot size: 42,473 sqft
    Year built: 2013
    Parking spots: 22
    Days on market: 291
  33. 6 beds, 6 full, 3 half baths
    Home size: 9,572 sq ft
    Lot size: 16,442 sqft
    Year built: 2012
    Parking spots: 16
    Days on market: 19
  34. 4 beds, 6 full, 3 half baths
    Home size: 7,644 sq ft
    Lot size: 19,545 sqft
    Year built: 2001
    Parking spots: 12
    Days on market: 347
  35. 4 beds, 4 full, 2 half baths
    Home size: 3,545 sq ft
    Lot size: 41,318 sqft
    Year built: 1929
    Parking spots: 6
    Days on market: 285
  36. 5 beds, 2 full, 6 three-quarter, 2 half baths
    Home size: 11,000 sq ft
    Lot size: 2.96 ac
    Year built: 2016
    Parking spots: 30
    Days on market: 12
  37. 5 beds, 2 full, 3 three-quarter baths
    Home size: 3,976 sq ft
    Lot size: 9,375 sqft
    Year built: 2002
    Parking spots: 4
    Days on market: 196
  38. 6 beds, 8 full, 2 half baths
    Home size: 7,000 sq ft
    Lot size: 8,657 sqft
    Year built: 2006
    Parking spots: 8
    Days on market: 277
  39. 6 beds, 7 full, 2 half baths
    Home size: 10,393 sq ft
    Lot size: 14,597 sqft
    Year built: 2016
    Parking spots: 12
    Days on market: 81
  40. 4 beds, 5 full, 1 half baths
    Home size: 8,800 sq ft
    Lot size: 13,473 sqft
    Year built: 2002
    Parking spots: 5
    Days on market: 165
  41. 6 beds, 6 full, 4 half baths
    Home size: 12,937 sq ft
    Lot size: 15,008 sqft
    Year built: 2007
    Parking spots: 9
    Days on market: 346
  42. 4 beds, 4 full, 1 three-quarter, 1 half baths
    Home size: 4,158 sq ft
    Lot size: 12,174 sqft
    Year built: 1928
    Parking spots: 8
    Days on market: 51
  43. 5 beds, 5 full, 1 half baths
    Home size: 7,543 sq ft
    Lot size: 9,000 sqft
    Year built: 2002
    Parking spots: 12
    Days on market: 76
  44. 4 beds, 2 full, 2 three-quarter, 2 half baths
    Home size: 4,000 sq ft
    Lot size: 4,792 sqft
    Year built: 2010
    Parking spots: 2
    Days on market: 346
  45. 4 beds, 4 full, 1 three-quarter baths
    Home size: 5,300 sq ft
    Lot size: 11,000 sqft
    Year built: 2004
    Parking spots: 3
    Days on market: 56
  46. 6 beds, 8 full, 2 half baths
    Home size: 9,255 sq ft
    Lot size: 9,529 sqft
    Year built: 2009
    Parking spots: 3
    Days on market: 306
  47. 4 beds, 4 full, 1 half baths
    Home size: 8,081 sq ft
    Lot size: 9,450 sqft
    Year built: 1989
    Parking spots: 6
    Days on market: 285
  48. 6 beds, 7 full, 2 half baths
    Home size: 11,579 sq ft
    Lot size: 7,800 sqft
    Year built: 2012
    Parking spots: 9
    Days on market: 175
  49. 4 beds, 5 full, 1 half baths
    Home size: 7,348 sq ft
    Lot size: 9,000 sqft
    Year built: 2002
    Parking spots: 16
    Days on market: 27
  50. 5 beds, 5 full, 3 half baths
    Home size: 7,014 sq ft
    Lot size: 11,635 sqft
    Year built: 2017
    Parking spots: 6
    Days on market: 69

See all Balboa Island Homes For Sale.
(all data current as of 5/22/2017)

Listing information deemed reliable but not guaranteed. Read full disclaimer.

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