Rent or Buy? Milli Drexler XECO/212 April 7, 2013

Rent or Buy? The birth of a child means new responsibilities for the parents. One of the biggest responsibilities is providing a safe place for the child to live. This means the parents need to make a decision on whether to rent or buy a larger home for the growing family. If I were personally presented with this decision right now, I would make the choice to rent rather than buy. As I considered this decision I took into consideration many the economic principles that I have learned in this course and how they affect my ability to buy a house. The first principle I thought about was how much I could afford to pay for a house. This was the major factor affecting my decision. My income right now is very limited so at this time I do not have the means to save toward a down payment. Without a guarantee that my financial situation will increase, it is not wise for me to make a commitment like this at this time. I need to finish my education and find a more secure, better paying job first. I also considered other economic related factors when I made this decision. I thought about the type of neighborhood that I would want to live in, the additional financial responsibilities of owning a home, the total monthly and yearly cost of homeownership, the risks that come with owning rather than renting, my lifestyle and spending habits and my current savings account (O'Brien, 2005). A growing family should decide on what type of neighborhood they want to live in. I would want my family grow up in a good neighborhood with good schools. In most cases this is what most people want but often they make the decision in a hurry and be forced to live in a declining neighborhood with subpar schools.