- Data from the latest NAR Profile of Home Buyers and Sellers shows the number one reason buyers are buying today is for the plain desire to own a home of their own. They want a place where they can come home at night that is their special place in the world. The most common home purchased among buyers was a detached single-family home, with three bedrooms, 2 bathrooms, and 1,900 square feet.
- The typical buyer is satisfied with their buying process and plans to live in the perfect home for them for 15 years.
- Data from the report show the highest share of home buyers are married couples compared to single buyers and unmarried couples. The share of married couples who purchased a home (65%) is actually at its highest share since 2001. Married couples typically have higher household incomes than single buyers and thus better purchasing power in today’s tightened financial market environment.
- While married couples might have double the purchasing power of single females and single males when buying a home, they too are still making sacrifices to get into a home. Thirty-one percent of married couples who recently purchased a home cut spending on luxury items or non-essential goods, and 26 percent cut spending on entertainment. Perhaps the married home buying couple is dining-in tonight?
- A sizeable amount of the market are still single females, single males and unmarried couples – more than one-third. While the married couples may be cooking in tonight, the single buyers and unmarried couples could be taking advantage of the neighborhood features that influenced their home purchase – proximity to friends and family, entertainment and leisure activities, and shopping.
- Married, unmarried, single male, and single female, all recent home buyers will enjoy the quality of the neighborhood they picked – as it influenced the majority of all household types, and hopefully all will enjoy a good meal tonight, or at the least some tasty chocolate.
The Office of the Comptroller of the Currency published its Semiannual Risk Perspective for the spring of 2012 on July 5th. In it, the agency outlined concerns about a potential wave of rate resets on home equity lines of credit (HELOCs) that are set to occur from 2014 until 2017. While these loans certainly merit concern given the already stressed banking and mortgage finance system, the current market environment has created room for borrowers to absorb the higher costs and primed the banking system to provide aid where needed, which should help to ameliorate this issue.
In addition to tangible financial benefits, research has shown that homeownership brings substantial social benefits for families, communities, and the country as a whole. Because of these societal benefits, policy makers have promoted homeownership through a number of channels. Homeownership has been an essential element of the American Dream for decades and continues to be so even today. Some of the documented social benefits include:
- Increased charitable activity
- Civic participation in both local community and national issues (including voting)
- Greater awareness of the political process
- Higher incidence of membership in voluntary organizations and church attendance
- Greater social capital generated
- Greater attachment to the neighborhood and neighbors
- Lower teen pregnancy by children’s living in owned homes
- Higher student test scores by children’s living in owned homes
- Higher rate of high school graduation thereby higher earnings
- Children more likely to participate in organized activities and have less television screen time
- Homeowners take on a greater responsibility such as home maintenance and acquiring the financial skills to handle mortgage payments and those skills transfer to their children
- Lower teenage delinquencies
- General increase in positive outlook to life
- Homeowners reported higher life satisfaction, higher self-esteem, happiness, and higher perceived control over their lives
- Better health outcomes, better physical and psychological health
- Tremendous wealth gains for homeowners under normal housing market conditions (outside of the terrible bubble/bust housing years)
- Homeowners not only experience a significant increase in housing satisfaction, but also obtain a higher satisfaction even in the same home in which they resided as renters
- Family financial situation and housing tenure during childhood and adulthood, impacted one’s self-rated health (in particular, the socioeconomic disadvantaged indicated by not being able to save any money or not owning or purchasing a home are less likely to self-rate their health as excellent or very good).
- Less likely to become crime victims
- Homeowners better maintain their homes, and high quality structures also raise mental health -renter-occupied housing appreciates less than owner-occupied housing
- Housing prices are higher in high-ownership neighborhoods
- Maintenance behavior of individual homeowners is influenced by those of their neighbors
For more information on the social benefits of homeownership, be sure to check out our “Homeownership Matters: Stats and Data” page as well as our “Field Guide to Social Benefits of Homeownership“.
- According to the Social Benefits of Homeownership and Stable Housing paper, homeowners participate in elections much more frequently than renters. One study found that 77 percent of homeowners said they had at some point voted in local elections compared with 52 percent of renters.
- REALTORS® also understand the importance of voting. Ninety-five percent are registered to vote, 92 percent voted in the last national election, and 85 percent voted in their last local election.
- As the above shows, REALTORS® and homeowners tend to vote. The following story from NPR discusses who votes and who does not.
Home Ownership Rate Forecast
The U.S. home ownership rate stands at a 15-year low with the latest figures showing 65.6 percent of Americans living in owner-occupied homes. At peak in 2004 the ownership rate was a hair shy of 70 percent. Over the next two years it may fall further, possibly to 64 percent before stabilizing. But the falling homeownership rate will not mean fewer home sales. The dynamics is such that both the rental and ownership households will rise, though the proportion will be such that the home ownership rate will fall.
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