Dream Home Mathematics

Dennis W. Montgomery Lyman Trumbull Academy
5200 N. Ashland
Chicago IL 60640
(312) 534-2430


This lesson-game is designed for grade levels 5-12.
Students should be able to:

* Use basic math to determine affordability of a home based on a given income.
* Add, subtract, multiply, and divide, as required.
* Calculate decimal placement for currency, percentages and interest.
* Use a calculator.
* Estimate affordability based on income, prior to computation.
* Investigate different careers and their salary ranges.
* Understand and calculate percentage, interest rates.
* Understand gross income.
* Calculate and understand taxes, withholdings and deductions.
* Calculate net income.
* Understand and compute the expense and cost concept.

Materials: * Careers catalog/magazine with salaries
* Copies of newspaper classified section
* Calculators
* Pencil/pen
* Construction paper (approx. 11 X 12)
* Play money (optional for variation with banker)
* House plans with price (magazine's with house plans or create your own)
* Glue
* Scissors
* 3" x 5" index cards

Recommended Strategy: * Review lessons on computing percentages, interest, decimals and division.
* Review a range of home prices and designs.
* Review/teach the use of a calculator to compute interest, percentages, add,
multiply, divide and subtract taxes, deductions, and expenses.
* Skipping one space, number ten 3 x 5 cards 1 to 3. Head the card "CAREERS. Use
the following format: | CAREERS |
| |
|1. Career: Doctor |
| | 3 x 5 card
|2. Annual Salary: $250,000.00 |
| |
|3. Added Expenses: Child support |
| $1,000 or Child's College payment|
| $2,700 per month (add to F) |
Career card info may be obtained from a "Careers" catalog/magazine or create
your own (keep it realistic). Create real life "added expenses" =< $5,000
per month.
* Using any magazine, newspaper or both, the teacher or students cut out various
home plans (preferably with a picture) and glue each one to a sheet of
construction paper, numbering each and giving it a bold heading of "DREAM
HOME". Use the price listed in the newspaper, magazines or create your own.
In bold numbers, at the bottom of the construction paper, place the price of
the home. If you create your own, be realistic.
* Collect the career cards and the dream home sheets (in 2 stacks).
* Distribute one career card and one dream home sheet to each group.
* Create a data collection sheet in the following manner and order:
DREAM HOME MATH DATA COLLECTION: Can I afford to buy this home? What is your occupation and annual salary?______________________________ Compute your monthly income (x/12) A.______________ What is the cost of your home on "DREAM HOME CARD"? (y) B.______________ Compute tax & payroll deductions (33% of A.) C.______________ Compute loan payment (mortgage) & interest (9% of y)/12 D.______________ Compute monthly property tax (10% of y)/12 E.______________ Utilities, car payment, food & one child is your fixed monthly expense of $1,000 plus (+) the added expense from your career card F.______________ Compute total debt by adding lines C. and F. G.______________ Subtract line G. from line A. for net income H.______________ Add lines D. and E. for total home/mortgage cost I.______________ Subtract line I. from line H. for cash remainder (+/-) J.______________ If line J. has a positive(+) cash remainder, congratulations, you can afford to buy the home, go to the banker or loan officer for amount shown on line B. Each month you must pay the bank/loan company amount shown on line I. If line J. has a negative(-) cash remainder, I'm sorry, the home you have selected cost too much for the amount of net income you have after subtracting your total debt on line G. You don't make enough money to buy this particular home and have such large debts. Try a less expensive home. / = Divide/Division
x = Annual Gross Salary/Income
y = Cost of Dream Home
* Compare and graph home cost to net income/salaries, expenses/debt between
* Explore various careers and their salary ranges to teach affordability.
* Explore difference between rentals and home purchases and how basic math is
used to provide an answer for; "Can I Afford to buy this home?"

Performance Assessment:

Students should compare the cost of buying a home and renting. Math calculations
on data collection sheet will be checked for accuracy. Students at a later
lesson, use their parents income and rent/mortgage to determine homes they can


Any variations to "DREAM HOME MATH" should consider age and grade level.
and pictures if possible. This exercise reinforces five (5) primary math
functions and introduces the student to one of the most valuable lessons of
life, simplicity of math in buying a home.

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