The Myth of the Case Against Homeownership

It's been a while since I've posted anything, but there have been rumblings in various media that homeownership is overrated and perhaps people should not push so hard to own their own home.  Barbara Kiviat makes the case in Time Magazine (August 26, 2010) that "politics, industry, and culture aligned to create a fetish of the idea of buying a house".  She claims that "homeownership contributed to the hollowing out of cities and kept renters out of the best neighborhoods." and "fed America's overuse of energy and oil".  Finally Ms. Kiviat states that homowenership "helped us become casually self-deceiving: by telling ourselves that homeownership was a pathway to wealth and stable communities and better test scores".  I'm here to tell you that she could not be more wrong!

The fact of the matter is that according to the Federal Reserve Survey of Consumer Finances, the average net worth of homeowners vs. renters is nearly twelve times greater for homeowners with incomes between $30,000 and $49,999 ($126,500 to $10,000 respectively).  The disparity is even greater for those with incomes under $16,000 - $73,000 to $500 respectively - one hundred forty six times more wealth for homeowners!

Ms. Kiviat speaks of the illusion of "stable communities and better test scores" as a result of homeownership.  According to Donald Haurin, professor of economics, finance, and public policy at Ohio State University, in homeownership "there is security, pride, prosperity for the family, stability of neighborhoods, and economic growth.  There are benefits for children".  Researchers from the University of North Carolina at Chapel Hill and The University of Michigan suggest that children of homeowners are more likely to participate in organized activities and have less screen time (television viewing and playing video games) when compared to renters.  Their findings suggest that home ownership and financial stability may create opportunities for parents to engage in some positive parenting behavior.

For the last several years we've been involved in a culture war.  There seems to be a greater disparity between the haves and the have nots a dissolution of the middle class.  The arguments against homeownership seem to be one more step toward that end.  To tell those with the least to be satisfied with their lot in life and not to aspire to anything more reeks of elitism.  The great lie is that one has to be satisfied with his or her current situation.  We are blessed to have the opportunity to go as far as we want to go if we are willing to work hard and not give up.  A major step is homeownership.  America is full of examples of people who started with nothing, worked hard and made this country the land of opportunity.  There is a reason people from all over the world want to come to the United States.  The American Dream is alive and well and a major component of that dream is to have your own piece of God's green earth on which to raise a family.  Homeownership is not for the few, the rich, the haves.  It's for anyone who is willing to work hard and dream.  It is hard, but that is what makes it so satisfying when the dream comes true.