Grade 6-8, 9-12

Trish and Scott’s Big Adventure: An Investigation of Regional Housing Costs

Updated: October 13 2021,
Author: Jody Hoff

This lesson has students explore differences in regional housing costs, determine the percentage of gross income spent on housing, assess the impact of housing costs on a relocation decision and recognize wages and housing costs are prices.


This lesson has students explore differences in regional housing costs, determine the percentage of gross income spent on housing, assess the impact of housing costs on a relocation decision and recognize wages and housing costs are prices.

Learning Objectives

  • Explore differences in regional housing costs.
  • Determine the percentage of gross income spent on housing.
  • Assess the impact of housing costs on a relocation decision.
  • Recognize wages and housing costs are prices that influence people’s behavior.

Resource List


Computer Work

Consider the situation of Trish and Scott, a young couple with two small children living in Annapolis, Maryland. Both work. Scott is a family counselor and Trish is a production manager for a small computer company. Trish has just upgraded her education and is thinking about several new job offers, all of which require the family to relocate out of state. In Annapolis, Trish and Scott live in a three-bedroom, two-bath home on a .5 acre lot. The house is 15 years old and is 3,000 square feet in size. Their monthly house payment is $1,050, and their combined gross income is $75,000 per year (Trish earns $40,000 and Scott earns $35,000). Did you know that according to the Mortgage Bankers Association, 28% of your monthly income is considered the maximum amount you should spend for housing expenses (including loan payment, taxes, and insurance) and your total monthly debt payment cannot exceed 36%? What percentage of gross income is Trish and Scott’s house payment?

Use the calculator function on your PC computer by going to START, PROGRAMS, ACCESSORIES, and CALCULATOR or if you are using a Mac computer, go to the APPLE MENU and choose CALCULATOR. To make the calculation, you need two pieces of information, 1) the house payment amount, and 2) income earned each month. You have the house payment amount of $1,050, and you can calculate monthly income by dividing Trish and Scott’s yearly income by 12. (% of income spent on housing = $1,200/$6,666.67 * 100= 18%).

In order to make the move, Trish and Scott agree that they need a similar sized house in a friendly neighborhood, close to schools. Let’s assume that they can sell the Maryland house for $185,000, payoff their mortgage, and have $30,000 left over for a down payment on a new house. A mortgage is a special type of home and property loan that gives you legal ownership while you pay down the debt. Failure to pay off the loan, also known as defaulting, results in ownership of the home or property to be returned to the bank and a nasty credit history for the people who default.

Your job today is to examine the housing costs associated with one of Trish’s job offers. Find yourself a partner (or group, depending on class size) and select one of the following cities..

  • Belleville, Illinois
  • Bangor, Maine
  • Bozeman, Montana
  • College Station, Texas
  • Durham, North Carolina
  • Salt Lake City, Utah
  • Minneapolis, Minnesota
  • Nampa, Idaho
  • Walnut Creek (Contra Costa County), California
  • Wichita, Kansas
  1. Within the city, find Trish and Scott a potential house similar to the one they had in Annapolis, using the web site. Remember, you are looking for a 3,000 square foot, three-bedroom, two-bath home. Select a potential house and record the asking price, square footage, number of bedrooms, bathrooms, age of the house, and any other important characteristics.
  2. Calculate Trish and Scott’s monthly house payment, using the payment calculator. To make the calculation, you need some additional data from Trish and Scott. Assume that they want a 30-year mortgage and can borrow the money for the house at the interest rate reported at the NAR web site. Also enter the $30,000 down payment. Calculate and record the monthly payment for the house you select.
  3. How do the housing costs compare between Annapolis and the new city?
  4. Based on the 28% rule and $75,000 gross income, can Trish and Scott afford the house you selected? [Divide the new monthly payment by Trish and Scott’s monthly income.]
  5. What additional expenses, besides housing, do you think Trish and Scott make every month? Write them down.
  6. Remember that Trish has recently upgraded her education and as a result has been offered these new job opportunities. An increase in education and job skills should improve Trish’s ability to negotiate a higher salary. Assume Trish is offered a 25% salary increase. Calculate and record the family’s gross income, assuming that Scott’s salary remains unchanged.
  7. Now head over to’s to determine how much Trish and Scott need in gross income in the new city to maintain their quality of life. Record the amount. Is a 25% salary increase enough for Trish and Scott to be able to make it, financially speaking, in the new location? Be prepared to share and discuss your conclusion with the rest of the class.

Group Discussion

Each group will record the following information on the board or poster paper:

  • city
  • house asking price
  • income needed to maintain lifestyle
  • of income spent on housing

Based on the data, engage students in a group discussion related to Trish and Scott’s decision to relocate.

  1. What factors are influencing Trish and Scott’s decision to relocate? [Housing costs and income.]
  2. List the benefits and cost of relocation. [Increase in salary, opportunity for career advancement, housing cost, cost of living needs.]
  3. Assign the dollar amount to the benefit based on the 25% raise in salary for Trish. [$50,000 + $35,000 = $85,000; divide by 12 = $7,083.33.]
  4. Assign the dollar amount of the cost, for each city based on the monthly house payment. [Answers will vary.]
  5. Based on the dollar differences in salary benefits and housing costs, which city appears to be the best suited for Trish and Scott? [Answers will vary.]
  6. How would Trish and Scott’s decision to relocate be affected by moving into a 2,000 square foot house? [Less expensive, the difference in benefits and costs may change the decision.]
  7. How would Trish and Scott’s decision be affected by the fact that Scott is unable to find a job that pay as well as his old job? [Benefit is reduced; cost may exceed the benefit and affect the decision.]
  8. In general, how do the prices of housing and wages affect people’s decisions? [The interaction of benefits and costs influence people’s behavior, a higher salary may allow a person to relocate to a new city or housing costs may be to expensive to allow the move.]


Review the decision to relocate and the importance of assigning benefits and costs to each factor. Remind the students that wages and housing costs are prices that influence people’s behavior. Ask each student to investigate his or her own housing situation. Students should find and record data similar to the information investigate in this lesson, such as size of home or apartment, monthly payment, number of bedrooms and bathrooms, type of mortgage, and interest rate.

Extension Activity

Another activity related to this lesson involves the investigation of why housing costs differ around the country. Direct students to the Federal Reserve System web site

Students in each group would follow the link to their city’s regional federal reserve bank and click on the Regional Economic Update. Students would read the update to help determine economic conditions within their region and to learn those conditions relate to housing costs.

Additional funding for this site was provided by the Mortgage Bankers Association of America.