Key terms:

1. Mortgage:
A loan used to buy a house. You pay it back over time (usually 15–30 years).

2. Down Payment:
Money you pay upfront — usually 3%–20% of the home’s price.

3. Interest Rate:
The percentage the bank charges you for borrowing money. Even a small change (like 5% vs. 7%) can make a huge difference.

4. Property Taxes & Insurance:
Extra costs that come with owning a home — they can add hundreds of dollars to your monthly bill.

5. Maintenance Costs:
You can’t call a landlord anymore! Homeowners pay for repairs, lawn care, and improvements.

Discussion (5–10 minutes)

Ask:

• “Why might some people prefer to rent instead of buy?”
• “Why might owning a home still be a good investment in the long run?”
• “What are some risks of buying before you’re ready?”

Encourage students to connect this to stability, independence, and financial grow

The House Hunt Challenge (15–20 minutes)

Step 1: Divide students into groups of 3–4.
Give each group a scenario card (examples below).

Scenario A:
You make $3,000/month. You found a small house for $250,000.
Down payment = 10%. Interest = 6%.
Taxes + insurance = $300/month.
Is this affordable?

Scenario B:
You make $5,000/month. You found a house for $400,000.
Down payment = 5%. Interest = 7%.
Taxes + insurance = $400/month.
Is this affordable?

Step 2:
Each group uses this quick rule:

You should spend no more than 30% of your income on housing.

Calculate:

• Monthly income × 0.3 = max affordable payment.
• Compare that to the estimated cost (use an online mortgage calculator or the teacher’s handout table below).

Sample Estimate Table (for simplicity):

Home Price	Interest	30-Year Loan Payment (approx.)
$250,000	6%	$1,500/month
$400,000	7%	$2,660/month

Step 3:
Groups share if their scenario family can afford the home and why.