Final Project - New House Decision

Final Project - A New House Decision
Patricia Henson
January 15, 2012
Thomas Bell

Final Project - A New House Decision
Homeownership is the American dream. Purchasing a home is a major investment therefore the decision must be carefully weighed.   A prospective homeowner should have full knowledge of the repercussions and benefits of owning a home.
I am a single mom, living in a two-bedroom apartment, my income barely pays the bills and I need more space for my family. Continuing to pay rent will never allow me the chance to own my own home. The following principles of economics will help me to make the right decision. In addition, I realize the economy is the key reason to making my final decision in purchasing a home therefore the strength of the economy, the roles of domestic and international trade must be considered as well.

In these economic troublesome times, purchasing a home is major investment therefore certain principle of economics that should be considered to ensure that I am making the right decision to buy or not to buy.   N. Gregory Mankiw. (n.d.) states that the first Principle of Economics would be to face a trade-off; to get one thing that I would like, I would usually have to give up another thing that I like. It simply means trading off one goal against another goal (pg. 4.). There are many facts to consider when facing a trade-off to buy a house instead of continuing to rent an apartment. The idea of buying a home is very intriguing but in reality will I be able to afford a home?
Let’s consider some important facts: Trade- off: Principle 1 – rent versus mortgage, I presently pay $1,200.00 for rent which includes utilities and maintenance for repairs. Now if I purchase a home, I want to have the down payment and in some cases; there are programs that can help with eliminating down payments such as Neighborhood Assistance Corporation of America, (NACA). In addition, utilities, homeowner’s insurance, property taxes,...