POWER REAL ESTATE
How home purchase boosts consumer spending
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home purchase comes with additional costs to suit the buyer. The information is from the Consumer expenditure survey (CES), Labor statistics bureau. An additional cost is evident with appliances, furnishing and structure modifications. This paper will use information from NAHB’s recent estimates between 2017 and 2019 before the Covid 19 outbreak. The paper will also compare inhome owners of newly built homes, existing homes and non-moving homeowners.
REASONS FOR BUYING HOMES. Most people that buy a home are, in most cases, parents. People with families prefer to get a good detached home that is spacious and more comfortable compared to a rental apartment that might be squeezed up and not comfortable to use. Home buying process is also common with the wealthier class of people and more qualified personnel. The above-stated group of people are located in most urban centres. Research shows that the home buying process is used to show a difference in the socio-economic class. The lower socio-economic group tends to avoid the home buying process due to incurred extra expenses settling in rental apartments that do not come with additional expenses. THE COSTS INCURRED AFTER BUYING NEW HOMES. Repair and modification is the most expensive aspect when one decides to buy a home, whether a newly built one or one that had previously existed. It entails putting up an additional structure that did not exist at the time of purchase. It also means interfering with the structure’s design, such as repainting to a colour that one would want and putting up a driveway that would fit the new owner in the best possible way.
When relocating to a newly bought home, the owner must have roughly $2,800 set aside for furnishing. Furnishing includes items such as carpet, curtains and cushions within the first year of relocation, while non-moving homeowners at this time are known to spend less on furnishes as they don’t need many changes. There is little difference in the appliance where newly built homeowners are known to cash out only around $1,000 to cater for appliances. 12 | JULY 2022
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Surprisingly, new home buyers spend around $9,000 for repairs and modifications compared to people living in morgages that are legally theirs. Upon further research, the money is spread across outdoor fixtures like swimming pools, perimeter walls and niches, drive-ins and patios to suit their comfort.
