1. Group #4 House in P.V. vs. House in Diamond Bar Jeffery Small - Organizer Jon Lerdsuwanrut - Secretary David Lopez - Techie David Wong - Techie

2. Scenario To compare two houses of same initial value for investment purposes and to predict different factors that can effect its value. To buy a bigger house in a lower ranked city or a smaller house in a higher ranked city. Estimate the rate of return of the two situations.

3. House for Rancho Palos Verdes 61 Rockinghorse Road Rancho Palos Verdes, CA 90275 Cost: $1.5 Million Built in 1966 No Gated Community 4 Bedrooms 3.25 Bathrooms 23,560 square feet lot size 2,864 square feet Two Stories 2 Car Garage View Pool

4. House for Diamond Bar 2572 Steeplechase Lane Diamond Bar, CA 91765 Cost: $1.5 Million Gated Community: The Country Built in 1987 5 Bedrooms 3.5 Bathrooms 31500 sq. ft lot size 3,876 square feet home 3 car garage View Swimming Pool

5. Past Sales, Assessed, & Tax Info for Both Houses Rancho Palos Verdes Sold on January 11, 1990 for $623,000 Sold for $217.53 / Sq. Feet Assessed Value: $857,158 Land Value: 647,069 Improvement Value: $210,089 Tax Amount: $9,373 Diamond Bar Sold on January 22, 1990 for $920,000 Sold for $237.36 / Sq. Feet Assessed Value: $1,038,700 Land Value: $461,598 Improvement Value: $577,102 Tax Amount: $11,991

6. Assumptions We had $1.5 Million to pay off house Rent: Began at $1000 per Month per Room Raised 3% each year Property Tax: Began at 2% of Property Value Raised at 2% each year Property Insurance: Began at 2% of House Value Raised at 2% each year Annual Maintenance $1000 per year

7. Estimated Investment Return Based on Market Trends

8. Money Made in Relations to Market Fluctuation and Time in Market

9. IRR(ROR) in Relations to Market Fluctuation and Time in Market

10. Conclusion In every instance it was found that Palos Verdes would be the better investment. More stable market Better location Better reputation as a city Will always stay better than average no matter what the market fluctuation

11. Resources OCtitle.com Realtor.com LosAngelesAlmanac.com Century21.com Housevalue.com Mercury.com dab.nfc.usda.gov/pubs/docs/taxformulas/form ulas/statecitycounty/taxca/taxca.html -State tax information