A_New_House_-_Readiness

Checkpoint Format Format for XECO 212 Checkpoint (Week 1) “A New House - Readiness” 1. CheckPoint: A New House – Readiness Deciding to buy a house is a lifelong goal for many people. Imagine that you are renting a studio apartment and have just discovered you are having a baby. Your present apartment is small and far from schools and local services. You have decided to move. There are many factors that come into play when making such a large and weighty purchase. Examine the decision-making process from the perspective of an economist. In your Final Project, you use these principles and other factors to make a final decision whether to buy a house. Deciding to buy a house, in my opinion, would be a lifelong goal that I consider an extremely serious investment. My studio apartment would not be large enough for the newest member arriving to my family; it would only suit the time being. I have decided to move to larger accommodations. I am examining the factors that come into play with making such a large and weighty purchase from the perspective of an economist. The principles that I think would play a major role in my decision are: Principles 1 - 10. Principle 1: I would face tradeoffs in purchasing a home, a thorough look at my income and expenses will be a priority (i. e. what if scenarios). Principle 2: What can I give up to get my house (i. e. What is necessary and what is not necessary') Principle 3: What are the benefits and opportunities of a house over an apartment' Principle 4: What are the incentives for me owning a house' Principle 5: Is this a beneficial trade that can make it better for everyone' Principle 6: Would it be more beneficial organization owning a house (i. e. being closer to work, schools, etc.)' Principle 7: Would property rights enable more promotion for efficiency and to promote equity' Principle 8: Would this enable a higher standard of living or lower (with the trade offs in my budget)' Principle 9: Would inflation increase the overall price appreciation or depreciation of the house' Principle 10: Would there be a trade-off between inflation of the housing market and would I be able to afford this house if I became unemployed while purchasing this house' This indicates that accumulating a mortgage would be the best decision, but I must also consider inflation after purchase would result in the house appreciating in value and would be a positive factor. Other considerations in not purchasing a house would be that economic climate if the real estate market is inflated, it would be more advantageous to wait for the market to stabilize then purchase a house, and income constraints. Reference: University of Phoenix (Ed.). Chapter 1 – Ten Principles of Economics. [Cengage Learning]. Retrieved May 25, 2011, from XECO 212 – Principles of Economics.