A new house decision

A new house decision

Introduction

Economics plays a vital role in the decisions that we take, and has a bearing on our behavior on a daily basis. The theories of economics are used extensively by the people in order to take decisions, either subconsciously or consciously. Similarly, the principles of economics are applied to buying a new house, sometimes consciously where the pros and cons are looked at meticulously, or subconsciously. Through this research paper, one would be able to understand the influence of economics on the decision of buying a new house. Buying a new house is a very important decision, since a large amount of money is required to purchase a new house, and it is a decision which requires a lot of homework and thinking on the part of the buyer. Since buying a house costs a lot of money, it results in the consumption of an individual's savings by a large extent. According to the theories of economics, the greater the sum of money needed in order to buy something; the demand will be more price elastic, thus greatly price elastic is the demand for houses.

As far as buying a new house is concerned, it usually requires a large sum of money on the part of the buyer to be able to afford buy it, since houses are relatively expensive and are considered to be significant financial decisions. Buying a house would significantly lower the buyer's power to purchase, since a large chunk of his/her money is spent on purchasing the house. In addition, buying a new house is a difficult decision to make, since it is tough to move from a place which is well known to a place which is alien to the buyer, thus it can be termed a life-altering experience. Such factors contribute towards making the buying of a house a tricky and difficult decision.

Several economic factors will have to be taken into account as one looks to take a decision on a new house. The buyer has to be very careful when he is set to buy a new house since a wrong decision may result in severe financial losses. The buying of a new house is a very important decision and is one for which considerable financial outlay is required. Without taking into account the impact of homeownership, quite a lot of people take a rather casual approach when buying a new house. The decision of buying a new house should not be spontaneous or impulsive; rather it should be based on a thorough research of the market and on the principles of economics which must be considered at all costs. Moreover, the persons making decisions should take into account the costs that will be result from their actions (Slembeck, 2006).

Thesis Statement

The decision to buy a new house is affected by a number of economic factors which will be discussed through the course of this paper.

Discussion

Economic principles that directly influence the decision to buy a ...