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Team #4 Personal Investing Options-Buying a House

This project entails evaluating two scenarios for a 23-year-old engineering graduate with a starting salary of $60,000 who wants to buy a $500,000 house. Scenario One involves renting an apartment for five years before purchasing a house and paying off the mortgage in 30 years, while Scenario Two extends the renting period to ten years and pays off the mortgage in 25 years. By analyzing personal experiences, market prices, textbook resources, and consulting a bank representative, the project aims to determine the most financially viable option based on the goal of paying off the house in 35 years and saving 15% of income for a down payment at a 7% interest rate.

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Team #4 Personal Investing Options-Buying a House

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  1. Team #4Personal Investing Options-Buying a House Stephen Tran- Organizer Shake Babakhanyan- Techie Paige Lewis- Summarizer

  2. Project Scenarios • Scenario One • Rent an apartment for five years before buying a house and paying off the mortgage in 30 years • Scenario Two • Rent an apartment for ten years before buying a house and paying off the mortgage in 25 years

  3. Buyer Description • 23 year old engineering graduate • Starting salary of $60,000 a year • Looking to buy $500,000 house • Currently renting a one bedroom apartment for $1000 a month including utilities

  4. Scenario Constants • Wants to pay the house off 35 years from now • Can afford to save 15% income for down payment

  5. Goal • At 7% interest on the mortgage, which is the better option? • Is to see if the savings put into the down payment makes the monthly payments possible

  6. Resources • Personal experience • Market prices from internet sources • Textbook • Bank representative

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