Homeownership Is Still at the Heart of the American Dream
Purchasing a home is a significant choice that continues to be central to the American Dream. Unlike renting, homeownership extends beyond mere accommodation, providing a feeling of connection, stability, and independence. According to Nicole Bachaud, Senior Economist at Zillow:
“The American Dream is still owning a home. There’s a lot of pent-up demand for ownership; that isn’t going to go away.”
Let’s explore just a few of the reasons why so many Americans continue to value homeownership.
The Financial Benefits of Owning a Home
One potential explanation for the elevated regard of homeownership is its role as a substantial tool for building wealth.That may be why Jessica Lautz, Deputy Chief and VP of Research at the National Association of Realtors (NAR), says:
“Homeownership is the number one way to build wealth in America.”
Over the years, having a home not only contributes to the increase of your personal net worth but also lays the groundwork for the success of future generations as you pass down that accumulated wealth. Habitat for Humanity explains:
“Overall, homeownership promotes wealth building by acting as a forced savings mechanism and through home value appreciation. Homeowners make monthly payments that increase their equity in their homes by paying down the principal balance of their mortgage. . . . In addition, owning a home promotes intergenerational homeownership and wealth building. Children of homeowners transition to homeownership earlier — lengthening the period over which they can accumulate wealth . . .”
It can also offer substantial financial stability in contrast to renting. Opting for a fixed-rate mortgage allows you to secure your monthly housing payments throughout the duration of your home loan.
The Non-Financial Benefits of Homeownership
However, homeownership goes beyond providing financial advantages; it also brings social and emotional benefits. Your home evokes a sense of accomplishment, responsibility, and more. In a recent survey, Fannie Mae highlights some of these emotionally-driven benefits, including:
“The top three were having control over what you do with your living space (94%) to having a sense of privacy and security (91%) and having a good place for your family or to raise your children (90%) . . .”
What Does That Mean for You?
If your vision of the American Dream encompasses increased freedom, security, and prosperity, homeownership could play a pivotal role in turning that dream into reality. With mortgage rates currently declining, now might be an opportune moment for you to contemplate making a move.
If you’re prepared and capable of purchasing, be aware that remarkable benefits await you at the culmination of your journey. You’ll acquire more than just a residence – it’s a space to nurture your wealth and claim as your own. As Ksenia Potapov, Economist at First American, suggests:
“…homeownership remains an important driver of wealth accumulation and the largest source of total wealth among most households.”
Bottom Line
Making the decision to purchase a home is a significant step and a fundamental aspect of the American Dream. If owning a home is a part of your dream for this year, let’s connect so we can start the process to make your dream a reality!
