Can we actually afford the Cedar Heights place?
They're asking $650,000 with no real comps to back that number up. Here's what the homework says, and what it'd take to make this work.
Nobody's had this appraised yet — that's the whole point of doing this homework first. Every number in this file is built from public comps and county records, not a walkthrough. Treat it as a starting point for the conversation, not a verdict.
What's driving the number
This is a "lived here forever, built it exactly how we wanted it" sale — new windows, a full interior remodel, a 3-acre lot, a double garage, and a 40×40 insulated shop with electric. None of that shows up cleanly in the comps, because nothing quite like it has sold nearby recently. That's real, and it's also exactly why the asking price is hard to defend with data. Both things are true at once.
The plan: sell 5201 Sarna Dr, roll the proceeds into Cedar Heights, and land somewhere the numbers actually support — with enough cushion that the mortgage doesn't run the budget.
15102 Cedar Heights Rd
The house we want. Asking $650,000, not yet on the market, no appraisal on file.
Illustrative layout only — not a survey. Actual footprints, setbacks and boundaries unconfirmed.
Nearby comps
| Comp | Specs | Status | Result |
|---|---|---|---|
| 15116 Cedar Heights Rd two doors down |
2,047 sf · 3bd/2ba · built 1999 · unremodeled | Listed | $299,900–$325,000 |
| 4918 Sarna Dr | 2,604 sf · 5bd/3ba · 2-acre lot · built 1983 | Sold Nov 2022 | $456,000 ($175/sf) |
| 5119 Sarna Dr | 3,314 sf · 4bd/3ba · built 1986 | Sold Dec 2024 | $549,000 ($166/sf) |
5119 Sarna's own automated Zestimate has since drifted down to ~$445K — a reminder these algorithmic estimates get shaky fast on acreage properties with thin comps. Same problem we're up against here.
Building the number
| Component | Low | High |
|---|---|---|
| Base house — 2,072 sf @ $160–180/sf | $331,520 | $372,960 |
| 3rd acre beyond corridor norm | $10,000 | $20,000 |
| 40×40 shop, insulated + slab | $25,000 | $40,000 |
| Double garage building | $5,000 | $15,000 |
| Desk estimate total | $371,520 | $447,960 |
5201 Sarna Dr
The house we have. What it's likely worth, and what we still owe on it.
Nearby comps
| Comp | Specs | Status | Result |
|---|---|---|---|
| 4918 Sarna Dr | 2,604 sf · 5bd/3ba · 2-acre lot · built 1983 | Sold Nov 2022 | $456,000 ($175/sf) |
| 5119 Sarna Dr | 3,314 sf · 4bd/3ba · built 1986 | Sold Dec 2024 | $549,000 ($166/sf) |
Both comps sit on much bigger lots (1.9–2 acres) than our 0.54 acres — that pulls our number down from a straight $/sf match.
Value estimate
| $/sf assumption | Implied value (2,353 sf) |
|---|---|
| $150/sf | $353,000 |
| $160/sf | $376,000 |
| $170/sf | $400,000 |
| $180/sf | $424,000 |
This is what funds the down payment on Cedar Heights — see Exhibit C for how the sale price here changes what we can afford there.
Can we afford it?
Assumptions: 6.6% 30-yr fixed (current market ~6.5–6.7%), ~1.0% property tax, ~0.75%/yr insurance (rural + outbuildings run a bit higher — get real quotes), no HOA.
Cedar Heights alone, 20% down
| Price | Down (20%) | Loan | P&I | Tax | Ins. | PITI/mo |
|---|---|---|---|---|---|---|
| $475,000 | $95,000 | $380,000 | $2,427 | $396 | $297 | $3,120 |
| $500,000 | $100,000 | $400,000 | $2,555 | $417 | $312 | $3,284 |
| $525,000 | $105,000 | $420,000 | $2,682 | $438 | $328 | $3,448 |
| $550,000 | $110,000 | $440,000 | $2,810 | $458 | $344 | $3,612 |
| $575,000 | $115,000 | $460,000 | $2,938 | $479 | $359 | $3,776 |
| $600,000 | $120,000 | $480,000 | $3,066 | $500 | $375 | $3,941 |
| $650,000 | $130,000 | $520,000 | $3,321 | $542 | $406 | $4,269 |
If Sarna sells for … and Cedar Heights costs …
Net proceeds = sale price − $165,001.65 payoff − ~1.8% selling costs (title/closing only, no commission).
| Sarna sells for | Net proceeds |
|---|
A) 20% down, rest banked as cash cushion
| Sarna ↓ / Cedar Heights → | $475K | $500K | $525K | $550K | $575K | $600K |
|---|
B) All net proceeds down — lower payment, down % in parens
| Sarna ↓ / Cedar Heights → | $475K | $500K | $525K | $550K | $575K | $600K |
|---|
Rough income check (28% front-end rule of thumb, 20% down)
| Price | PITI/mo | Annual income "needed" |
|---|---|---|
| $475,000 | $3,120 | ~$134,000 |
| $500,000 | $3,284 | ~$141,000 |
| $525,000 | $3,448 | ~$148,000 |
| $550,000 | $3,612 | ~$155,000 |
| $575,000 | $3,776 | ~$162,000 |
| $600,000 | $3,941 | ~$169,000 |
A gut-check, not underwriting — actual approval depends on the full debt picture and lender.
Playing it smart
Where the real leverage is, and what going without agents changes.
The appraisal gapConventional lenders finance the lower of contract price or appraised value. If we agree to a number above what it actually appraises for, that gap doesn't get financed — it comes out of our cash, dollar for dollar, to still close at the agreed price. This is the single strongest, least-awkward thing we can raise with them: not "your house isn't worth it," just "our lender will only lend against what it appraises for."
| If it appraises at ↓ / Contract price → | $500K | $525K | $550K | $600K | $650K |
|---|---|---|---|---|---|
| $372K (low end) | $128K | $153K | $178K | $228K | $278K |
| $410K (midpoint) | $90K | $115K | $140K | $190K | $240K |
| $448K (high end) | $52K | $77K | $102K | $152K | $202K |
Cash we'd have to bring, beyond financing, to still close at that contract price.
Going FSBO
Total commission runs ~5.5–5.7% nationally (roughly split evenly), traditionally paid by the seller out of proceeds. Skip agents on both sides and that's a direct add to what we net on Sarna — and post-2024 NAR settlement, if we'd used a buyer's agent on Cedar Heights, there's a real chance we'd owe that fee directly rather than the seller, since there's no MLS listing for a concession to ride on.
What stays the same
- Arkansas is a title-company state — no attorney required to close, either way.
- Lender still orders its own appraisal if we finance, regardless of agents.
- Property tax, insurance, inspection costs — all unaffected.
What we take on ourselves
- Contract — AR "as-is" FSBO template, or an attorney review ($150–500/hr, often flat $350–500).
- Disclosures — still legally required under AR's Property Disclosure Act, no agent tracking it for us.
- Comps — no free agent CMA. A paid independent appraisal (~$400–600) earlier is worth it.
- Earnest money — route through the title company, not held by either of us directly.
Negotiation playbook
- Appraisal contingency, always. Standard, not insulting to ask for — protects us if it comes in low.
- Get a real number early. Independent appraisal or a paid CMA before agreeing to anything.
- Check the county assessor's value. Imperfect, but another anchor point — especially telling if they pulled permits for the remodel.
- Ask for permits/receipts. On the remodel, windows, roof, and the shop. A permitted shop appraises better than an unpermitted one.
- Confirm the shop and garage sit on the same deed as the house, especially with the new acre added.
- Get septic and well inspected, with maintenance records.
- No rush. It's not listed — no competing offers, no reason to skip the homework.
- Non-price terms matter to them too. Flexible closing around their move, minimal contingencies beyond inspection/appraisal — can be worth as much as the number itself.
Next steps
The actual to-do list, in rough order.
- Get a real number on Cedar Heights — independent appraisal or CMA (~$400–600) before agreeing to any price
- Confirm Sarna Dr's AC install date
- Ask about the shop's permits, parcel/deed status, and well/septic on Cedar Heights
- Decide: FSBO or agent for selling Sarna Dr
- Get pre-approved so we know our real qualifying number, not just this estimate
- Line up a title company for both closings
- Draft or get a contract template reviewed (attorney or AR as-is FSBO form)
- Set up neutral escrow for earnest money through the title company