Originally Posted by getbak
I know it's been pointed out many times how flawed the Flames' argument is that the city's proposal would require them to pay 120% of the cost of the building. I decided to crunch the numbers in a way that most of us should be familiar with, buying a house.
Let's say you're buying a $500,000 house and have a $100,000 down payment. You need to borrow the remaining $400,000 and get a mortgage.
Your bank offers you a mortgage with a 3.5% interest rate with the full loan to be paid off in 35 years. At the end of the loan, you will have paid a total of $694,328.27 with interest.
Now, during that time, you will have also been paying property taxes because that's what we all do. The property taxes on a half-million dollar house should be about $3,200 a year.
Let's assume a 2% annual increase in the tax rate. By the end of 35 years, your property taxes will cost $6,274.16 a year. Over the 35 years, you will have paid a total of $159,982.33 in taxes.
If we add it all up, after 35 years, you will have paid a total of $854,310.60 for your $500,000 house, or 170.86% of the original price.
EDIT: Whoops, forgot to include the original $100,000 down payment too... So, the actual total is $954,310.60 or 190.86%.
When you look at it that way, even if you buy into the idea that the Flames would be paying 120% of the cost, it's still a hell of a deal.
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