2.1 Choosing a Place 2.1 Choosing a Place To LiveTo Live

Unit 2Unit 2

When choosing a place to live When choosing a place to live you should consider the you should consider the

following about the location:following about the location:RegionRegionCommunityCommunityNeighborhoodNeighborhoodSiteSiteSpecific houseSpecific house

The RegionThe RegionSpecific part of the world, Specific part of the world,

country, or state in which you livecountry, or state in which you liveReasons for choosing a region Reasons for choosing a region

include:include:–ClimateClimate–FamilyFamily–JobJob

CommunityCommunity

Region is divided into Region is divided into communitiescommunities

Community may be large Community may be large city, small village, or rural city, small village, or rural areaarea

NeighborhoodNeighborhood

Communities are divided into Communities are divided into neighborhoodsneighborhoods

Neighborhoods are a group of Neighborhoods are a group of houses and peoplehouses and people

Buildings in a neighborhood are Buildings in a neighborhood are usually similar in age, design, usually similar in age, design, and costand cost

SiteSiteA location within a neighborhood A location within a neighborhood

is called a site or lotis called a site or lotA site is the piece of land on A site is the piece of land on

which the dwelling is builtwhich the dwelling is builtEach site has its own size, shape, Each site has its own size, shape,

contour and soil typecontour and soil type

Zones Within The SiteZones Within The Site

Public zonePublic zoneService zoneService zonePrivate zonePrivate zone

Public ZonePublic Zone

Part of the site that can be Part of the site that can be seen from the street or seen from the street or roadroad

Usually in the front of the Usually in the front of the househouse

Service ZoneService ZonePart of the site that is used for Part of the site that is used for

necessary activitiesnecessary activitiesIncludes sidewalks, driveways, and Includes sidewalks, driveways, and

storage areasstorage areasService area should be directly Service area should be directly

connected to the indoor service connected to the indoor service area, which includes the kitchen area, which includes the kitchen and laundry areaand laundry area

Private ZonePrivate Zone

Part of the site hidden Part of the site hidden from public viewfrom public view

Provides space for Provides space for recreation and relaxationrecreation and relaxation

Types of HousingTypes of Housing

House – any building that House – any building that serves as living quarters serves as living quarters for one or more familiesfor one or more families

Home – any place a person Home – any place a person liveslives

Multifamily HousesMultifamily Houses

Structure that provides housing for Structure that provides housing for more than one living unitmore than one living unit

Each living unit has its own distinct Each living unit has its own distinct living quartersliving quarters

Less costly than single-family Less costly than single-family houseshouses

Duplexes are two homes attachedDuplexes are two homes attached

CondominiumCondominium

Buyer owns the living space Buyer owns the living space but shares the parking areas, but shares the parking areas, recreational facilities, recreational facilities, hallways, and lobbies with all hallways, and lobbies with all ownersowners

Single-Family HousesSingle-Family Houses

one living-unitone living-unitRented or ownedRented or ownedAttached and freestandingAttached and freestanding

Attached HousesAttached Houses

Designed for one living unit Designed for one living unit but share a common wall with but share a common wall with the houses on each sidethe houses on each side

Example: townhousesExample: townhouses

Freestanding housesFreestanding houses

Single-family houses that stand Single-family houses that stand alonealone

Factory-built: housing constructed Factory-built: housing constructed in a plant and moved to a site, low in a plant and moved to a site, low cost and faster completion timecost and faster completion time

Site-built house: built on a lot, Site-built house: built on a lot, piece by piece on a foundationpiece by piece on a foundation

Modular HousingModular HousingFactory-builtFactory-builtThe walls, floors, ceilings, and roof The walls, floors, ceilings, and roof

panels are combined in boxespanels are combined in boxesWindows, doors, plumbing, and Windows, doors, plumbing, and

wiring also includedwiring also includedAll pieces put together at building All pieces put together at building

sitesite

Manufactured/MobileManufactured/Mobile

Completely built in factoryCompletely built in factoryBuilt on wheels and rolled Built on wheels and rolled

to the housing siteto the housing site

Kit HouseKit House

Shipped to the site in as a Shipped to the site in as a finished shell from the factory. finished shell from the factory.

Interior is completed according to Interior is completed according to the buyer’s wishes once arrives the buyer’s wishes once arrives at the building siteat the building site

Cheapest of all the factory built Cheapest of all the factory built homeshomes

Housing for Older peopleHousing for Older people

Retirement plans affect Retirement plans affect housing choiceshousing choices

Example: If a couple chooses Example: If a couple chooses to travel when they retire, to travel when they retire, they may want a home with they may want a home with little maintenance and upkeeplittle maintenance and upkeep

As people age and are unable to As people age and are unable to move easily they need housing move easily they need housing that has easy cleanup and that has easy cleanup and requires little maintenancerequires little maintenance

Universal design may be a choice Universal design may be a choice –Making houses easier for Making houses easier for everyone to useeveryone to use

Universal Design ExampleUniversal Design Example

Add a no-step entrance with a Add a no-step entrance with a wider doorway and non-slip wider doorway and non-slip floorsfloors

Universal design can help Universal design can help everybody, not just the everybody, not just the elderlyelderly

Housing for People with DisabilitiesHousing for People with DisabilitiesFair Housing Act – forbids Fair Housing Act – forbids

discrimination in housing and discrimination in housing and requires multi-units to be requires multi-units to be accessible to people with accessible to people with disabilitiesdisabilities

Must have accessible entrances, Must have accessible entrances, wider doors, and easier installation wider doors, and easier installation of grab bars around toilets and of grab bars around toilets and bathtubsbathtubs

2.2 Renting Vs. Buying2.2 Renting Vs. Buying

RentingRenting 1/3 of people rent1/3 of people rent Rent is usually paid monthlyRent is usually paid monthly Before you move into a rental property Before you move into a rental property

you must pay a security deposit – this you must pay a security deposit – this insures the owner against financial loss insures the owner against financial loss caused by the rentercaused by the renter– Usually the amount of 1-months rentUsually the amount of 1-months rent– Returned when you move out if you did Returned when you move out if you did

not cause damage to the rental unitnot cause damage to the rental unit

Advantages of RentingAdvantages of Renting

Free to move when you wantFree to move when you wantDon’t have to worry about Don’t have to worry about

buying or sellingbuying or sellingNo maintenance or home No maintenance or home

improvement costsimprovement costs

Before renting you should check Before renting you should check the following:the following:

Laundry facilitiesLaundry facilities Building lobbyBuilding lobby Entrance, exit, and hallsEntrance, exit, and halls Bathrooms (does plumbing work, hot water)Bathrooms (does plumbing work, hot water) Kitchen (make sure appliances are working)Kitchen (make sure appliances are working) Air conditioning and heating (does it work)Air conditioning and heating (does it work) Wiring (should be 3 outlets per room, Wiring (should be 3 outlets per room,

switches work)switches work)

LightingLightingWindows (broken, drafts around the Windows (broken, drafts around the

windows)windows)Floors (clean and free of nicks)Floors (clean and free of nicks)Ceilings (water stains)Ceilings (water stains)Walls (cracks)Walls (cracks)Soundproofing (can you hear Soundproofing (can you hear

neighbors?)neighbors?)Telephone (phone jacks installed)Telephone (phone jacks installed)

Television (antenna/cable Television (antenna/cable television hookup)television hookup)

Storage space (large enough Storage space (large enough closets/enough cabinets)closets/enough cabinets)

Outdoor play space (is their any Outdoor play space (is their any outdoor areas/decks/etc.)outdoor areas/decks/etc.)

Rental AgreementsRental Agreements

Can rent month-to-month or year by Can rent month-to-month or year by yearyear

Must sign a leaseMust sign a lease– Legal document spelling out the Legal document spelling out the

conditions under which the renter conditions under which the renter rents the propertyrents the property

– Lists rights and responsibilities of the Lists rights and responsibilities of the owner (lessor) and the renter (lessee)owner (lessor) and the renter (lessee)

A Lease should include:A Lease should include:

Address and apartment numberAddress and apartment number Date signedDate signed Signatures of lessee and lessorSignatures of lessee and lessor Date to move in and length of leaseDate to move in and length of lease Cost of rent and when it is dueCost of rent and when it is due When the lease will renew (is it automatic?)When the lease will renew (is it automatic?) Who’s in charge of specific responsibilities Who’s in charge of specific responsibilities

such as cutting grass, shoveling snow, such as cutting grass, shoveling snow, repairingrepairing

““entry” clause which allows the lessor to entry” clause which allows the lessor to enter the apartment with notice or in an enter the apartment with notice or in an emergencyemergency

Who is responsible for water, electricity, gasWho is responsible for water, electricity, gas Security deposit amount and what must be Security deposit amount and what must be

done to receive it back when leavingdone to receive it back when leaving Clause that says the final inspection of the Clause that says the final inspection of the

property will be made in the lessee’s property will be made in the lessee’s presencepresence

Lease can’t be changed without written Lease can’t be changed without written approval by the lessor and lesseeapproval by the lessor and lessee

If the apartment can be subletIf the apartment can be sublet Pet clausePet clause

Assigning/Subletting a LeaseAssigning/Subletting a Lease

If you have signed a lease, but If you have signed a lease, but you want to move out early you you want to move out early you have three options:have three options:– Continue paying rent until the Continue paying rent until the

lease expireslease expires– Assign the leaseAssign the lease– Sublet the leaseSublet the lease

Assigning a LeaseAssigning a Lease

Transfer the entire lease to Transfer the entire lease to someone elsesomeone else

After this is done you are no After this is done you are no longer responsible for the rental longer responsible for the rental property or any damage done to property or any damage done to the propertythe property

Subletting a LeaseSubletting a Lease

Transfer part of the rental property Transfer part of the rental property to someone elseto someone else

Both you and the person you sublet Both you and the person you sublet to are responsible for the property to are responsible for the property and any damage that may occurand any damage that may occur

Both assigning/subletting costs extra Both assigning/subletting costs extra moneymoney

Breach of ContractBreach of Contract

If the lessor or lessee is If the lessor or lessee is unable to fulfill the rental unable to fulfill the rental agreement they are in breach agreement they are in breach of contractof contract

If you are in breach of If you are in breach of contract you may be suedcontract you may be sued

EvictionEviction

If a lessee does not abide by the If a lessee does not abide by the rental agreement they may be rental agreement they may be evictedevicted– This is a legal procedure that forces This is a legal procedure that forces

a lessee to leave the property a lessee to leave the property before the rental agreement before the rental agreement expiresexpires

– You must receive a warning before You must receive a warning before being evictedbeing evicted

Advantages to Buying a HomeAdvantages to Buying a Home

Freedom because know can’t be Freedom because know can’t be evictedevicted

Make own decisions about Make own decisions about maintenance and improvementsmaintenance and improvements

Value of a home tends to increaseValue of a home tends to increaseTax deductions for taxes and interest Tax deductions for taxes and interest

paid on a homepaid on a home

Disadvantages to Buying a Disadvantages to Buying a HomeHome

Strain on finances to make monthly Strain on finances to make monthly paymentspayments

Additional expenses such as property Additional expenses such as property taxes, insurance, utilities, maintenancetaxes, insurance, utilities, maintenance

Possibility of foreclosure (legal process of Possibility of foreclosure (legal process of having home taken away) if can’t make having home taken away) if can’t make monthly paymentsmonthly payments

Can’t move as easilyCan’t move as easily Have to do and pay for maintenanceHave to do and pay for maintenance

How much can I afford to pay?How much can I afford to pay?

Must assess your income, the size of Must assess your income, the size of your savings account, and your debtsyour savings account, and your debts

Estimate what you can affordEstimate what you can afford–Gross income X 2.5Gross income X 2.5–Gross income is your income before Gross income is your income before taxes and deductions are taken outtaxes and deductions are taken out

How big of a loan can I take How big of a loan can I take out?out?

To qualify for a loan must meet to To qualify for a loan must meet to guidelinesguidelines– Housing-to-income ratioHousing-to-income ratio

Housing costsHousing costs = 28% or less = 28% or less

gross incomegross incomeHousing costs include monthly Housing costs include monthly payment, property tax, insurance, payment, property tax, insurance, utilities, repairs, maintenanceutilities, repairs, maintenance

– Debt-to-income ratioDebt-to-income ratioHousing costs + debtsHousing costs + debts = 36% or less = 36% or less

gross incomegross income Remember you must also pay a down Remember you must also pay a down

paymentpayment– This is money paid before taking out a This is money paid before taking out a

loanloan– Usually 5% - 20% of the cost of the Usually 5% - 20% of the cost of the

househouse

What if I choose to build?What if I choose to build?

If you build a home you must do the If you build a home you must do the following:following:– Choose a building siteChoose a building site– Choose a house plan that will fit the Choose a house plan that will fit the

sitesite– Select a contractorSelect a contractor– Obtain money to pay for house (loan)Obtain money to pay for house (loan)

Buying HomesBuying Homes Buying new = move in quickly, no repairs Buying new = move in quickly, no repairs

will be neededwill be needed Buying pre-ownedBuying pre-owned

– Cost lessCost less– May need some work – be sure to May need some work – be sure to

inspect foundation, roof, for insect inspect foundation, roof, for insect damage, etc.damage, etc.

– Have house inspectedHave house inspected– Have house appraised – tells you how Have house appraised – tells you how

much the home/property is worthmuch the home/property is worth

Where can I look for a home?Where can I look for a home?

Real estate firm – they will charge a Real estate firm – they will charge a commissioncommission–5%-10% of selling price5%-10% of selling price

NewspapersNewspapersWord of mouthWord of mouth““for sale” signsfor sale” signsShopping guidesShopping guides

Steps in Buying a HouseSteps in Buying a House

Agreement of Sale: states where Agreement of Sale: states where property is located, purchase price, property is located, purchase price, amount of down payment, when can amount of down payment, when can move inmove in

Earnest money – money paid to show Earnest money – money paid to show you are interested you are interested –When deal goes through this money When deal goes through this money is applied to your loanis applied to your loan

Abstract of title – reveals the true Abstract of title – reveals the true legal owner of propertylegal owner of property

Survey – land will be surveyed so you Survey – land will be surveyed so you know how much is yoursknow how much is yours

Secure a mortgage – take out a loan Secure a mortgage – take out a loan (usually 20-30 years)(usually 20-30 years)

Closing costs – fees/charges for Closing costs – fees/charges for settling the legal/financial matters of settling the legal/financial matters of a home (survey, etc)a home (survey, etc)– Can be thousandsCan be thousands

Title and deed Title and deed –Title – proof of the right to own Title – proof of the right to own the propertythe property

–Deed – legal document showing Deed – legal document showing that the title is transferred from that the title is transferred from one person to anotherone person to another

Insurance – usually required if Insurance – usually required if taking out a loantaking out a loan

What if I took out a 30 year loan, What if I took out a 30 year loan, but now I can pay more each but now I can pay more each

month?month?Refinance – adjust your loan Refinance – adjust your loan

paymentspayments–it may cost money to it may cost money to refinancerefinance

–Good idea of interest rates Good idea of interest rates have droppedhave dropped