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Home Buying Process and its Financial Impacts
Finance & Accounting
Pages 3 (753 words)
Home Buying process and its Financial Impacts Buying a house can be the largest amount invested or spent upon any asset by the individual and so a careful investigation is necessary about the pros and cons of a home buying process 1. What are some common opportunity costs associated with the selection of housing?
In one word it can be termed as opportunity costs undergone during the process of housing. While buying a house it is compulsory that a fair amount needs to be given out as down payment. The individual has to pay a considerable sum of money as security deposit even with the consideration of renting an apartment. In both the cases one has to let out the savings interest that could have been earned the money being kept in a bank. The brokerage fee is another cost involved looking for a house which could have been spent elsewhere. If the house selected is few miles away from the workplace the individual has to take the pain of a long journey every day. In case the individual is renting a house he is losing out the advantages of tax obtained from buying a house. But at the same time the person has to bear sufficient trouble to build a house of his choice and needs (Kapoor, 2009, p. 272). 2. What are the advantages and disadvantages of owning a home? Home Ownership has been considered as the rational form for housing with more than 70% of the British households having houses in their list of assets. Such ownership statistics for the year 1991 reveal 59% for USA and 40% for Switzerland. Home ownership is advantageous as houses are saleable assets. ...
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