Lessons >>> Lesson 16
The decision to buy a home is probably the biggest financial decision you will make in your lifetime. The differences between renting and owning are enormous, but the question of which is better for you is a highly personal one. Let's see how does buying a home compare with renting.
The one advantage of renting is being generally free of most maintenance responsibilities. But by renting, you lose the chance to build equity, take advantage of tax benefits, and protect yourself against rent increases. Also, as a tenant you may not be free to remodel and redecorate without permission and may be at the mercy of the landlord for housing.
Owning a home has many benefits. Owning a home qualifies you for tax breaks that assist you in dealing with your new financial responsibilities - like insurance, real estate taxes, and upkeep - which can be substantial. The security, comfort and peace of mind you get from home ownership are well worth the investment.
Once you are in the market for a home, think about how do you envision your ideal abode. Do you see yourself in a cozy character home with ornate fireplaces? Or does the image of a brand new home built with today's state-of-the-art technology beckon? Either way, you'll find that buying a home can be a wonderful experience and at the same time an arduous task.
There are many factors that help decide just exactly what you're looking to buy: price, location, style of home, distance to work, schools and child care, crime rate, traffic, proximity of shops, public transportation, places of worship, recreational facilities.
Since price seems to be the dominating factor it's good to determine what price range you'll be looking in. Knowing what you can afford before you embark on hunting for a new home can save you a lot of time and put you in a strong bargaining position to buy the best property for the least money. If you are like most of us, you will borrow funds to finance your home purchase. Getting pre-approved for a loan puts you firmly in the driver's seat. Amongst other things such as interest rates and your credit history, lenders consider your assets, income and long-term debts when calculating a "safe" mortgage payment.
After you determine a price range, you can start choosing an area and type of home. If it's close to where you live now, this is easier. Drive around some neighborhoods. Pay attention to how well the houses are kept up. You can also make a note of how close these areas are to work, school, shops etc. It may not make a difference when you're initially looking - but it could be a final determining factor when trying to decide between two houses.
While looking for an area, you can also decide what type of houses you like. Do you want a one storey or two? A bi-level or tri-level? Condo, townhouse or house? There are many different types of homes to choose from, and everyone has a preference. Pick a few different types and rank them from highest to lowest. Think also about number of rooms (dining-room, living-room, bedrooms and bathrooms, study), flexibility for changing use of space in the future, security systems, outdoor spaces.
If you're looking in an area you're not familiar with, it is a good idea to use a realtor. Your realtor should be able to help find the information on which to base your evaluation.
You'll want to look at and compare homes that are both old and new before making the decision on which you prefer. Your selection, to a large extent, will be determined by your lifestyle and in most cases becomes a matter of compromise. For instance, you may find a perfect 80 year-old gem that needs a fair bit of renovation work and tender loving care - but this may not necessarily fit into your budget plans. On the other hand, you may find a new home attractive, but would have to spend extra money on landscaping and installing some of the amenities which may be part of the package in an older home.
Advocates of older homes will tell you that it's difficult and potentially expensive to duplicate the charm of an older house in a newer one. With an older home you don't have to try and picture the completed house from a set of blueprints and the house has been "shaken down" - structural faults are clearly seen and can be or have been corrected. And also, with an older home, you often get the added advantage of improvements made by previous owners.
New home advocates will point out that buying a brand new house is like getting a fresh start. You can choose to purchase a custom-built home designed exactly to suit your own needs, or a home built on order from a sample model house or plans.
But take a close look at the quality of each model home - is construction solid, the finishing well done with attention to details? Compare layouts and size (more square feet does not always mean more living space). Find out if the features in each model home are standard or upgrades (i.e. extra cost) and ask to see samples of the builder's standard finishing products. When viewing a model home, don't hesitate to try out windows, open drawers, look into every nook and cranny, and inspect the home's mechanical system. Ask about optional or upgrade "packages" (e.g. lighting and plumbing fixtures). Note the features of each home that appeal to you (worth considering when you have made a final decision on a model and have some leeway for details). Ask about lot availability for the home model you are interested in - there may be restrictions. Imagine your family's daily routine throughout the seasons.
Regardless of what type of home you choose - old, new, or in-between - be sure you examine all your options first, so that you are happy with the final choice.
Test it out!
Fill the gaps in the sentences, using the phrases below:
brand new, mortgage payment, at the mercy of, ideal abode, amenities, set of blueprints, real estate, bargaining, realtor, ornate fireplaces, nook and cranny, build equity, custom-built, places of worship
Feng Shui: Redecorating for Your Spirit
Feng Shui (fung shway) is an ancient Chinese art of placement and alignment that dates back some 5,000 years. Practitioners strive to find the proper arrangement of objects and furniture that will best suit your personality and lifestyle. The goal is to arrange a home in such a way as to maximize feelings of safety and comfort, which will, in turn, positively affect your health, attitude, even your level of success.
In Chinese "feng" means wind and it represents all that is not seen – our moods, feelings and spirituality. "Shui" means water, and it represents all that is visible and tangible – our possessions and structures. Basically, Feng Shui is a philosophy of creating balance between the physical and spiritual worlds.
Traditional Feng Shui revolves around placement and symbolism. More contemporary Feng Shui also considers a number of psychological factors, including the use of color, aromatherapy, and air quality.
A Feng Shui Consultant will locate the various energy centers of your home, make new arrangements, and use crystals, mirrors, and chimes to achieve certain effects. Before you call in a consultant, there are a few tricks you can try on your own.
Feng Shui in the bedroom. Your bed should be positioned such that you have a clear view of the doorway. Your headboard should touch the wall, many practitioners say. And don't place the bed against the window or your ch'i might escape.
Some Feng Shui experts point the head of the bed north to induce sound sleeping, but different headboard positions produce different effects. For example, a headboard pointing west can make one lazy, while a headboard pointing south is said to worsen family arguments.
Feng Shui in the Kitchen. The kitchen is one of the most important rooms in the home because of the link between food preparation and the nourishment of the body and spirit. Feng Shui practitioners believe, for example, that the flavor of food will change if the cook is startled, so they recommend placing a mirror nearby so you can see who is entering while you are busy at the stove.
Feng Shui in the Living Room. Attract more light in the family sector of your living space with crystals and mirrors. Position living room furniture so your guests face either south or east when sitting, and make sure no seats make guests stare at the wall.
Feng Shui in the Dining Room. Choose a round, oval, or octagonal dining room table, since angles on tables create shars (negative energy zones). Feng Shui practitioners also say that these rounded tables create a more welcoming environment.
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