Answer
$\$109,926.55$
Work Step by Step
The inflation can be calculated as:
$FV=PV\times (1+r)^{t}$
Here, the future value of the house is $\$200,000$
The inflation rate is $r=0.5\%$
The number of monthly periods is $t=10\times 12=120$
Therefore the present value is:
$FV=PV\times (1+r)^{t}$
$PV=\frac{FV}{ (1+r)^{t}}=\frac{200,000}{1.005^{120}}\approx 109,926.55$