head: Running CHECKPOINT: A NEW HOUSE ECONOMY
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Checkpoint: A New House Economy
Brandon Tate
XECO-212
October28,2011
Alvin Fuentes
CHECKPOINT: A NEW HOUSE ECONOMY
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Checkpoint: A New House Economy
The purchase of a new house can be a life altering decision and requires a long period of
time for the buyer to gather the information needed to make the best possible purchase. There are
several factors which can affect the decisions the potential buyer will make when purchasing a
home.
One of these factors is the economy, when the economy is doing badly, people are less
likely to buy houses. This is due to the potential buyers fears of being able to make the payments
on the home in the weak economy. Just the opposite is also true, people may also see it as a
benefit and a good time to purchase a new house since housing prices are low and they can reap
a profit in the future should they purchase the house this during period. When the economy is
healthy, potential buyers are more optimistic and willing to spend their money without the worry
of losing their jobs. In a healthy economy customers will purchase more homes.
Tax benefits are another factor that comes into play when purchasing a new home. Tax
benefits play a large part in the decision process, for example there is currently an $8,000 dollar
tax deduction to first time home buyers. The removal of this tax deduction would cause housing
sale to decrease because the consumer would lose the tax incentive when purchasing the home.
Changes in government spending and taxes will also affect the potential buyers decision
to purchase a new home as well. If there is an increase in taxes the customer is going to be
paying more out of his/her pocket when it comes time to pay taxes on the purchase and the
personal property taxes they pay each year.