Homeownership has critical community, economic and social benefits
June is Homeownership Month, and this year’s observance is very different from last year. Last year we were in the fury of the hottest housing market in recent history. This year the focus is turning down the heat. There are also questions about affordability and how many would-be homeowners are being shut out by rising prices, higher mortgage rates, inflation, and that persistent lack of inventory issue.
There is no question that sales are beginning to soften, but it’s at a snail’s pace so far. Prices are still increasing because there is more demand than supply, and real estate is one of the leading wealth producers in our economy. For example, if you bought an existing local home at the median price for the first four months of 2010 and sold it for the price for the first four months of this year, you would have gained $99,431. There are also many tax advantages for real estate investing and homeownership
Homebuyers spent $2.4 billion on homes in the area monitored by NETAR in 2021. When the economic multipliers are added, it was a little over $3 billion contributed to the area’s economy. And that doesn’t include new home sales or homes that were not listed on the local MLS
There’s no question that the economic aspects of homeownership get most of the public attention. So, what better time than National Homeownership Month to pause and look at the other side of the homeownership story.
A couple of years ago, a research economist at the NAR wrote a white paper that sheds some light on the often-overlooked facets of homeownership. It pointed out that in addition to economic benefits, research has shown that homeownership brings substantial social benefits for families, communities, and the country as a whole. These societal benefits are just as much of the motivation for policymakers to promote homeownership as the economic advantages. Simply put, homeownership provides much of the societal glue for healthier communities on both the financial and social sides of the ledger.
Here are the often overlooked but documented social benefits of homeownership:
– Increased charitable activity.
– Civic participation in local community and national issues (including voting).
– Greater awareness of the political process.
– Higher incidence of membership in voluntary organizations and church attendance.
– 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.
– Homeowners take on a greater responsibility such as home maintenance and acquiring the financial skills to manage mortgage payments, and those skills transfer to their children.
– Lower teenage delinquencies.
– Homeowners reported higher life satisfaction, higher self-esteem, happiness, and higher perceived control over their lives.
– Solid wealth gains for homeowners under normal housing market conditions.
– 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.
– 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.
You can further explore the aspects of homeownership at these two websites produced by NAR to highlight and add community focus. Home Ownership Matters ttps://homeownershipmatters.realtor/ and HouseLogic https://www.houselogic.com/
NETAR is the voice for real estate in Northeast Tennessee. It is the largest trade association in the Northeast Tennessee, Southwest Virginia region, representing over 1,600+ members and 100+ business partners involved in all aspects of the residential and commercial real estate industries. Weekly market reports and information for both consumers and members are available on the NETAR website at https://netar.us