Chapter 9 Flashcards
Families today often spend up to what percent of disposable income on housing?
30% to 40%
What would cause a person to prefer renting over buying housing?
Unknown job stability in the geographical area.
What may a renter have to pay when moving into an apartment?
The first month’s rent, the last month’s rent, and/or the security deposit.
What do prospective renters need to consider?
The amount of rent and related expenses, the lease agreement and restrictions, and the tenant rights.
With what kind of lease does the agreement stay in effect unless either party gives proper notice?
A periodic tenancy lease.
What kind of lease expires unless notified otherwise?
A tenancy for a specific time.
What is it called when a tenant who wants to move before his or her lease is up, and leases to another tenant?
Subleasing
What would a habitability standards for rental property include?
Running water, heat, and a working stove…etc.
What is a form of housing ownership where the owner holds legal title to a specific housing unit and a proportionate interest in the common grounds and facilities?
A Condominium
Monthly fees assessed to buyers of cooperatives include what funds?
The management fees, insurance convering the building(s), and payment on the cooperative’s debt.
When comparing buying versus renting comparable housing, renting requires what kind of annual cash flow while buying typically does what to one’s tax liability?
Renting requires a lower annual cash flow. And buying typically decreases one’s tax liability.
What is an increase in the value of a home over time?
Appreciation
What tax deductible expenses are related to home ownership?
Mortgage interest and property taxes.
The amount a person will save in taxes from home ownership is…
Mortgage interest plus property taxes minus the standard deduction times by the marginal tax bracket. (See Review Assessment)
When preparing a budget to buy a new home, you should add an additional what percent to the monthly payment on the loan for things like homeowner’s insurance, property taxes, maintenance, and upkeep?
30% to 40%
