Cash Requirements of Real Estate
Naples Area

Whether you are buying a primary residence, or a second home, it's important to understand the cash requirements needed during the purchase phase and over the long run.

Initial Cash Requirements

Initial cash requirements will include the amount needed for down payments, cost of the transactions and furnishings. Those using a conventional mortgage will need a down payment of 20%, cash for closing costs, plus furnishings. Many sellers will include furnishings in the listing price, which greatly reduces early cash needs. The following chart can be used as a guide for approximating cash needs during the purchase phase. Note: Each real estate purchase is unique, a good faith estimate of early cash needs can only be prepared based on the terms of the contract, deed restrictions and the individual desires of the buyer.

Cash Needs for the Purchase Phase
Mortgage at 20% Down
Purchase of an Existing Home
(FOR DISCUSSION PURPOSES ONLY)

Purchase Price =	$150,000	200,000	300,000	500,000
Down Payment 20% - A down payment of 20% avoids mortgage insurance expense. Down payments as low as 5% are possible.	$30,000	40,000	60,000	100,000
Cost to Close - Cost of the transaction. Get the details here.	3,835	4,305	5,245	7,125
Furnishings - Typical amounts for new furnishings in a new unit. Amounts vary based on individual needs and tastes, and whether it's new or used furniture. See where to shop here.	12,000	16,000	22,000	35,000
Typical cash needs	45,835	60,305	87,245	142,125
Alternative Cash Needs - Using a 5% down payment, and furniture is either financed or included in the purchase price.	$11,335	14,305	20,245	32,125

Annual Cash Requirements

When financed, the property will have monthly mortgage payments, as well as property taxes and other ongoing expenses. The following chart can be used as a guide for approximating regular ongoing cash needs, at different purchase prices, when using a conventional mortgage. Note: Each real estate purchase is unique, a good faith estimate of ongoing cash needs can only be prepared based on the terms of the contract, deed restrictions, loan terms, location of the property and the individual desires of the buyer.

Ongoing Cash Requirements
20% Down Payment - 6% Interest - 30yr Term
(FOR DISCUSSION PURPOSES ONLY)

Purchase Price =	$150,000	200,000	300,000	500,000
Mortgage Payment - Annual principal and interest payments based on 20% down and 6% interest rate.	8,634	11,511	17,267	28,778
Property Taxes - Based on General Collier County tax rate, non-homestead. Rates will be higher if the property is located within special taxing districts.	2,025	2,700	4,050	6,750
Utilities/Other - Hazard insurance, utilities and other items.	1,500	1,600	1,700	1,800
HOA/Condo Fees - This amount can vary significantly based on the type of community, amenities or association. Rate shown would be representative of a "no frills" community.	2,400	2,400	2,400	2,400
Annual Cash Needs	14,559	18,221	25,417	39,729
Average Monthly Amount	$1,213	1,518	2,118	3,311

Note: An interest rate of 6% is used for example purchase, mortgage loans at much lower rates are readily available.