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Hrm/531 Week 4

Decent Essays

Renting or buying married couples have only one question in deciding. Research is the answer. By the time it is done, both partners will be exhausted. There is one method the couple can try using. Its called price-to-rent ratio.
1. Find two similar houses and two similar apartments, one for sale and one for rent.
2. Divide the sale price of the one place by the annual rent for the other. The resulting number is the P/R ratio.
For example, a $200,000 house for sale, and a similar house on the next block renting for $1,000 per month ( which is $12,000 a year ). Divide $200,000 by $12,000 and you get a 16.7 P/R ratio. According to David Leonhardt at …show more content…

In the early years of a mortgage, the majority of the monthly mortgage payment goes to paying the interest. Over time an increasing amount goes to reducing the principal. As the principal is reduced, the equity will increase on the owners home. Owners Gain tax advantages by deducting mortgage interest and property taxes from their federal income tax form. They should Stabilize their payments with a fixed interest rate on their home loan. They should Have a secure place for their family to live. A home provides a permanent place where a family can live and grow, and the owners can decorate or expand a house the way they would like to create their dream home. There is always a negative compared to a positive. A home could lose value. There is no guarantee that a home will increase in value. It could decrease in value especially in a rocky housing market. Another benefit renters have over homeowners is that they do not have to pay property taxes. This can be a

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