To Rent Or Own... That's the Question.Many consumer goods consumer goods Any tangible commodity purchased by households to satisfy their wants and needs. Consumer goods may be durable or nondurable. Durable goods (e.g., autos, furniture, and appliances) have a significant life span, often defined as three years or more, and , services producers and retailers devote extensive time studying how households spend their incomes. The multifamily housing industry also competes for a share of the incomes of their residents with a broad array of good and services. The U.S. Department of Labor (USDL USDL United States Department of Labor ) collects extensive data on how household incomes through a survey, the Consumer Expenditures Survey (CES). It analyzes recently released data for 1998 and two other years for comparison purposes. The total expenditures in the CES data table is not a perfect representation of actual total cash outlays Outlays Payments on obligations in the form of cash, checks, the issuance of bonds or notes, or the maturing of interest coupons. in a given period. The CES records the total price of goods and services In economics, economic output is divided into physical goods and intangible services. Consumption of goods and services is assumed to produce utility (unless the "good" is a "bad"). It is often used when referring to a Goods and Services Tax. purchased, with the exception of a house, even though it may be financed. This is most likely to occur in consumer durable goods durable goods Goods, such as appliances and automobiles, that have a useful life over a number of periods. Firms that produce durable goods are often subject to wide fluctuations in sales and profits. Also called consumer durables. such as automobiles No invention has so transformed the landscape of the United States as the automobile, and no other country has so thoroughly adopted the automobile as its favorite means of transportation. and major appliances A major appliance is usually defined as a large machine which accomplishes some routine housekeeping task, which includes purposes such as cooking, food preservation, or cleaning, whether in a household, institutional, commercial or industrial setting. . The distortion distortion, in electronics, undesired change in an electric signal waveform as it passes from the input to the output of some system or device. In an audio system, distortion results in poor reproduction of recorded or transmitted sound. in the reported data from actual outlays is probably small and does not hurt most generalizations concerning the data. Renters tend to have lower incomes than homeowners and spend a larger share of their incomes for housing, food and clothing, but less in actual dollar terms. Incomes of renters averaged $25,854 in 1998. This is a little more than half of the $50,578 average for homeowners. Renters pay a smaller share of their total incomes for taxes - 6.7 percent versus 8.2 percent for homeowners. Taxes include federal, state and local income taxes and personal property and other personal taxes paid, including Social Security taxes for the self-employed self-em·ployed adj. Earning one's livelihood directly from one's own trade or business rather than as an employee of another. self . Social security payments of individual employees are not treated as taxes. They are treated as expenditure and are combined with pension contributions in the Labor Department The Department of Labor (DOL) administers federal labor laws for the Executive Branch of the federal government. Its mission is "to foster, promote, and develop the welfare of the wage earners of the United States, to improve their working reporting. Renters are younger than homeowners, with an average age of 39.6 years versus 52.1 years. A portion of the difference in incomes arises from the age difference. Incomes rise until peaking in the 45-to-54 years of age bracket In programming, brackets (the [ and ] characters) are used to enclose numbers and subscripts. For example, in the C statement int menustart [4] = ; the [4] indicates the number of elements in the array, and the contents are enclosed in curly braces. . The average size of renter household in 1998 was 2.2 persons, versus 2.7 persons for homeowners. Renters have an average of 1.2 earners per household versus 1.4 for homeowners. Renters have an average of 0.6 children, versus 0.7 for homeowners. Total housing expenses of renters in 1998 represented a little over one-third, 34.1 percent, of their pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta income, or $8,804 in actual money terms. Total housing expenses include rents, personal property insurance, utilities, home furnishings furnishings the extra type or quantity of hair on the head, tail, ears or legs, specified for a particular breed. For example, the feathers in setters, the beard in Bearded collies, the eyebrows in Schnauzers. and equipment, household operations, including personal services personal services n. in contract law, the talents of a person which are unusual, special or unique and cannot be performed exactly the same by another. These can include the talents of an artist, an actor, a writer, or professional services. such as baby sitters and day care, and other expenses such as house cleaning services, pest control pest control n → control m de plagas pest control n → lutte f contre les nuisibles pest control pest n , and appliance A stand-alone hardware device or software environment dedicated to a specific task. See hardware appliance and software appliance. repair, and housekeeping A set of instructions that are executed at the beginning of a program. It sets all counters and flags to their starting values and generally readies the program for execution. supplies. Renters expended ex·pend tr.v. ex·pend·ed, ex·pend·ing, ex·pends 1. To lay out; spend: expending tax revenues on government operations. See Synonyms at spend. 2. 27.4 percent of their income for housing under the more traditional definition that includes rents and utilities. Homeowners expend ex·pend tr.v. ex·pend·ed, ex·pend·ing, ex·pends 1. To lay out; spend: expending tax revenues on government operations. See Synonyms at spend. 2. more in dollar terms of their incomes for total housing costs, $13,326, but less as a share of their incomes, 26.3 percent. Total housing expenses for homeowners includes interest on mortgages, property taxes and insurance, refinancing Refinancing An extension and/or increase in amount of existing debt. and prepayment Prepayment 1. The payment of a debt obligation prior to its due date. 2. The excess payment over a scheduled debt repayment amount. Notes: 1. Examples include deferred expenses such as rent and early loan repayments. 2. charges, ground rent, expenses for property security, homeowners insurance, fire insurance, expenses for repairs and maintenance, and expenses of materials for repairs and maintenance for dwellings maintained by the consumer unit. Spending for food accounted for 14.4 percent of renter's incomes, versus 10.7 percent for homeowners. Renters spend a greater share of their incomes for eating away from home than do homeowners, six percent versus 4.6 percent. Clothing and services spending, such as shoe repair and dry cleaning dry cleaning, process of cleaning fabrics without water. Special solvents and soaps are used so as not to harm fabrics and dyes that will not withstand the effects of ordinary soap and water. Dry cleaning began in France about the middle of the 19th cent. , accounted for 5.2 percent of renters income, versus 3.7 percent for homeowners. Renters spending for clothing and services on a dollar per person basis was $611, versus $687 for homeowners. Transportation costs averaged 16.9 percent of pre-tax incomes of renters, versus 15.6 percent for homeowners. Renters have fewer cars than homeowners, with vehicle ratios per household of 1.2 and 2.4, respectively. There are four areas of expenditures where renters spend a smaller proportion of their incomes than do homeowners: health care--four percent versus 4.7 percent; cash contributions--2.2 percent versus 2.8 percent; life and personal insurance--0.6 percent versus 1.1 percent and pensions and social security--6.7 percent versus 7.3 percent. Many low-income low-in·come adj. Of or relating to individuals or households supported by an income that is below average. renters do not have health insurance, so a significant portion of their health care costs may be covered by Medicare Medicare, national health insurance program in the United States for persons aged 65 and over and the disabled. It was established in 1965 with passage of the Social Security Amendments and is now run by the Centers for Medicare and Medicaid Services. . Lower incomes of many renters limits their ability to make charitable contributions charitable contribution n. in taxation, a contribution to an organization which is officially created for charitable, religious, educational, scientific, artistic, literary, or other good works. , purchase life and personal insurance and save for retirement. The younger age of renters is also probably a factor in their lower spending for life insurance since premiums rise with age. There was little change in the distribution of expenditure shares of total incomes of renters from 1988-98. The most significant change was in their spending for transportation. It dropped 3.4 percent. Two-thirds of this decline came in vehicle purchases. Relatively low oil prices throughout most of the period helped lower the share of income for gasoline gasoline or petrol, light, volatile mixture of hydrocarbons for use in the internal-combustion engine and as an organic solvent, obtained primarily by fractional distillation and "cracking" of petroleum, but also obtained from natural gas, by and motor oil. Greater fuel efficiency also helped. Knowing the amounts and shares of expenditures for various goods and services can be helpful in evaluating the impact of price changes on a renter household. For example, the recent increase in oil prices had the potential of increasing a typical renter's spending for gasoline and motor oil by as much as $350 per year if they did not change their driving habits. Many renters may have a difficult time absorbing ab·sorb tr.v. ab·sorbed, ab·sorb·ing, ab·sorbs 1. To take (something) in through or as through pores or interstices. 2. To occupy the full attention, interest, or time of; engross. rent increases at current levels if energy prices remain high.
AVERAGE EXPENDITURES FOR GOODS AND
SERVICES OF RENTERS IN SELECTED YEARS
1998
Renters
Number of Homeowners 38266
(in thousands)
Income Before Taxes $25,854 100.0%
Income After Taxes 24,119 93.3%
Age of Head 39.6
Number of Persons 2.2
in Household
Children under 18 0.6
years of age
Number of Earners 1.2
Number of Vehicles 1.2
Expenditures Dollars %
Total 24,859 96.2%
Housing 8,804 34.1%
Shelter 5,761 22.3%
Owned Dwellings 58 0.2%
Rental Dwellings 5,488 21.2%
Other 216 0.8%
Utilities, Fuel & 1,592 6.2%
Public Services
Home Furnishings & 892 3.5%
Equipment
Household Operations 291 1.1%
Housekeeping Supplies 268 1.0%
Food 3,711 14.4%
At Home 2,170 8.4%
Away From home 1,540 6.0%
Alcoholic Beverages 281 1.1%
Apparel & Services 1,345 5.2%
Transportation 4,357 16.9%
Vehicle Purchases 1,892 7.3%
(net outlay)
Gasoline & Motor Oil 710 2.7%
Other Vehicle Expenses 1,437 5.6%
Public Transportation 318 1.2%
Health Care 1,022 4.0%
Entertainment 1,120 4.3%
Personal Care 290 1.1%
Reading 99 0.4%
Education 527 2.0%
Miscellaneous 867 3.4%
Cash Contributions 572 2.2%
Life and Personal Insurance 146 0.6%
Pensions and Social Security 1,721 6.7%
1998 1993
Homeowners Renters
Number of Homeowners 68916 36955
(in thousands)
Income Before Taxes $50,578 100.0% $22,344
Income After Taxes 46,447 91.8% 20,696
Age of Head 52.1 39.5
Number of Persons 2.7 203
in Household
Children under 18 0.7 0.7
years of age
Number of Earners 1.4 1.1
Number of Vehicles 2.4 1.1
Expenditures Dollars % Dollars
Total 41,452 82.0% 21,820
Housing 13,326 26.3% 7,421
Shelter 7,191 14.2% 4,821
Owned Dwellings 6,570 13.0% 43
Rental Dwellings 29 0.1% 4,592
Other 592 1.2% 187
Utilities, Fuel & 2,856 5.6% 1,409
Public Services
Home Furnishings & 1,993 3.9% 689
Equipment
Household Operations 687 1.4% 244
Housekeeping Supplies 599 1.2% 258
Food 5,416 10.7% 3,436
At Home 3,115 6.2% 2,185
Away From home 2,310 4.6% 1,251
Alcoholic Beverages 325 0.6% 248
Apparel & Services 1,855 3.7% 1,318
Transportation 7,871 15.6% 3,468
Vehicle Purchases 3,560 7.0% 1,510
(net outlay)
Gasoline & Motor Oil 1,187 2.3% 705
Other Vehicle Expenses 2,632 5.2% 1,195
Public Transportation 491 1.0% 238
Health Care 2,392 4.7% 936
Entertainment 2,092 4.1% 1,195
Personal Care 462 0.9% 303
Reading 195 0.4% 109
Education 609 1.2% 400
Miscellaneous 1,280 2.5% 808
Cash Contributions 1,408 2.8% 361
Life and Personal Insurance 539 1.1% 161
Pensions and Social Security 3,683 7.3% 1,476
1993 1998
Renters
Number of Homeowners 36224
(in thousands)
Income Before Taxes 100.0% $18,714 100.0%
Income After Taxes 92.6% 17,316 92.5%
Age of Head 39.5
Number of Persons 2.3
in Household
Children under 18 0.7
years of age
Number of Earners 1.2
Number of Vehicles 1.3
Expenditures % Dollars %
Total 97.7% 18,994 101.5%
Housing 33.2% 6,307 33.7%
Shelter 21.6% 4,128 22.1%
Owned Dwellings 0.2% 43 0.2%
Rental Dwellings 20.6% 3,795 20.3%
Other 0.8% 291 1.6%
Utilities, Fuel & 6.3% 1,139 6.1%
Public Services
Home Furnishings & 3.1% 593 3.2%
Equipment
Household Operations 1.1% 224 1.2%
Housekeeping Supplies 1.2% 223 1.2%
Food 15.4% 2,874 15.4%
At Home 9.8% 1,616 8.6%
Away From home 5.6% 1,258 6.7%
Alcoholic Beverages 1.1% 277 1.5%
Apparel & Services 5.9% 1,113 5.9%
Transportation 16.3% 3,804 20.3%
Vehicle Purchases 6.8% 1,799 9.6%
(net outlay)
Gasoline & Motor Oil 3.2% 676 3.6%
Other Vehicle Expenses 5.3% 1,101 5.9%
Public Transportation 1.1% 227 1.2%
Health Care 4.2% 744 4.0%
Entertainment 5.3% 878 4.7%
Personal Care 1.4% 251 1.3%
Reading 0.5% 106 0.6%
Education 1.8% 283 1.5%
Miscellaneous 3.6% 631 3.4%
Cash Contributions 1.6% 394 2.1%
Life and Personal Insurance 0.7% 131 0.7%
Pensions and Social Security 6.6% 1,202 6.4%
Source: U.S. Department of Labor - Bureau of Labor Statistics Bureau of Labor Statistics (BLS) A research agency of the U.S. Department of Labor; it compiles statistics on hours of work, average hourly earnings, employment and unemployment, consumer prices and many other variables. Mr. Sheehan People whose surname is or was Sheehan include:
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