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Where will you live?

Where will you live?. Where will you be living in a few years? Why do people rent rather than purchase?. 8-1 FIND A PLACE TO LIVE. LEARNING TARGETS. Calculate the affordability of a monthly rent. Determine the relationship between square footage and monthly rent.

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Where will you live?

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  1. Where will you live? • Where will you be living in a few years? • Why do people rent rather than purchase?

  2. 8-1FIND A PLACE TO LIVE LEARNING TARGETS Calculatethe affordability of a monthly rent. Determinethe relationship between square footage and monthly rent. Determine lease signing costs. Calculatemoving expenses.

  3. tenant landlord furnished unfurnished square footage lease expire application deposit security deposit Key Terms

  4. A rule of thumb is that a person should budget 25% to 30% of gross monthly income for rent. We will use 28% of gross monthly income. Example 1 Alex makes $61,992 per year and pays about 25% of his gross monthly income in federal and state taxes. He wants to find an apartment to rent. Estimate how much he can afford to pay for rent each month. Then determine how much money he will have after taxes and rent are paid.

  5. CHECK YOUR UNDERSTANDING Bethany’s monthly gross income is $3,840. She pays 24% of her monthly gross earnings in federal and state taxes and 15% for her student loan. Bethany uses 15% of her monthly gross income to pay toward her credit card balance. She wants to rent an apartment that will cost $1,800 per month. Will she be able to make the payments without changing the amounts she pays toward her student loans and credit card balances?

  6. EXAMPLE 2 Rufus and Maria have both been offered new jobs in a different city. A real estate broker sent them an analysis of listings of apartments in their desired location showing the monthly rent was related to the square footage by the equation: rent = .91x + 403.09 where x is the square footage a) What would you expect the monthly rent to be for an 800 sq. ft. apartment? b) What would you expect the monthly rent to be for an 1,200 sq. ft. apartment? c) How much does rent increase for every increase of 100 sq. ft?

  7. EXAMPLE 3 Rufus and Maria paid a $200 application deposit for an 1,150- square foot apartment that has monthly rental of $1,595. They are required to provide a credit report that costs $25 and pay a security deposit equal to one month’s rent. The landlord also requires the first and last month’s rent at the time of signing the lease. How much should they expect to pay to be able to move into the apartment?

  8. CHECK YOUR UNDERSTANDING Larry is renting an apartment that will cost $850 per month. He must pay a $100 application fee and a $25 credit report fee. His security deposit is two month’s rent, and he must also pay the first and last month’s rent upon signing the lease. How much money does he need to move into the apartment?

  9. Example 4 Jay is moving from an apartment in Miami to one in Orlando. If Jay moves on a weekday, he will need more movers’ time to pack, load, unload, and unpack because his friends will not be able to help him. If he moves on a weekend, he can get his friends to help, cutting down on the number of hours he will need to hire movers. MoveOut is a moving company that supplies movers, trucks, and moving equipment. They have given him the following moving estimates. Weekday MoveWeekend Move 6 hours of loading/unloading 4 hours of loading/unloading 5 hours of packing/unpacking 2 hours of packing/unpacking $720 total cost $400 total cost MoveOut charges a set hourly moving team rate for loading and unloading, and a different set hourly moving team rate for packing and unpacking. Determine the MoveOut hourly rates.

  10. EXAMPLE 5 Samantha is moving from Madison, WI to La Crosse, WI. She will do all of the packing and unpacking by herself with her brother. The moving company quoted a price of $1,250 for 8 hours of loading and unloading and driving 130 miles. The company quoted the same price if the truck drives an extra 30 miles to pick up Samantha’s brother, which will reduce the loading and unloading time to 6 hours. How much does the company charge per hour for the loading/ unloading? How much do they charge per mile for driving?

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