 Security deposit – a refundable amount a renter pays in advance to protect the owner against damage or nonpayment.  Mortgage – a loan to purchase real estate.  Landlord – the owner or owner’s representative of rental property.  Tenant – a person who rents property.

 Lease – a written agreement that allows a tenant to use property for a set period of time at a set rent payment.  Down payment – the amount paid at purchase to bring down the amount owed.  Closing costs – the expenses incurred in transferring ownership from buyer to seller in a real estate transaction.

 Think about the housing choices of your older siblings or friends who recently moved into a place of their own.  Share - Where are they living? How do they feel about living in their own home? How does it compare to living with their family?

 Physical needs – shelter from elements, safe place for possessions, space for personal activities  Emotional needs – privacy and personal expression  Social needs – gather with family and friends

 It all depends on the size and location.  You must determine what you can afford.  You will need a security deposit and probably first and last month’s rent.  Utilities – may be included or separate (make sure you find out up front)

 Furniture and Appliances – you may have to provide them, may not.  Insurance – a cost you need to plan in budget  Rent or Mortgage – actual monthly payment  Being a homeowner adds property taxes to the cost of housing.

 Spend no more than 1/3 of gross pay on housing  Renting or Buying – it’s not just finances  Shared Housing › You can have roommates › You can stay with family  Either way – know what you are getting into

 Cities › Offer great cultural experience, entertainment and shopping › Crowded and noisy  Suburban Areas › Access to the city without the drawbacks  Rural Areas › Small community away from city life  What are some of your opinions about the locations above?

 Familiarity › Friends and family › Security  Desire for Change › Challenge for something different  Lifestyle Considerations › Live near school or work/commute › Climate, physical features, low cost  Practical Considerations › Transportation, shopping

 It is a Landlord and Tenant relationship  Advantages › It is fixed expenses › There is greater flexibility › You have more free time – less maintenance › There is a lower insurance cost

 Disadvantages › There are restrictions › There are financial drawbacks › You have limited control  Selecting a Rental › Go beyond floor plan and decorations › Consider location – safe and near things › What utilities are included?  Signing a lease › It is an agreement › It is a legal and binding document › You will probably need deposits

 Advantages: › There is stability – you won’t get kicked out › There is greater freedom – you can do what you want with the place › The home will have investment value › There are tax advantages

 Disadvantages › There can be unexpected expenses › There will be time spent on maintenance › You have reduced mobility  Buying Procedures › Decide: Needs, Wants, Price range › Check on: Safety, convenience & stability › Get agent and shop around › You then make an offer & negotiate

 Financial Considerations › Know the monthly installments › Know the up front & one-time costs  Down payment (5-20%)  Closing costs › A home is usually the most significant purchase anyone makes - it should be done wisely.

 You can investigate housing prices in different locations that are interesting to you (pick several students)   