Chapter 5, Problem 15AA

To determine

To explain: Advantages and disadvantages of owning and renting of homes.

Explanation of Solution

	Owning	Renting
Advantages	Buying own house is a good investment because the value of the house always appreciates. It gives freedom to pay monthly rent and a person is free to use modify and construct the house.	Renting a house requires only security deposits and 1 or 2 months rents. Renters are free from paying the house taxes and repair and maintenance charges. Renting allows for greater mobility. A person can move anytime when it requires.
Disadvantages	Buying a house requires a substantial down payment. It can be a thousand dollars down payment. Owners have to pay the house taxes and repair and maintenance charges. The mobility of a person becomes hard because it will have to leave the house.	The monthly payment of rent is compulsory. If rent is not paid then the tenant has to vacate the house. The tenant has to follow certain rules and regulations imposed by the owner. Physiological pressure or financial pressure to pay monthly rent even if the person has zero income but rent is compulsory.