The American Dream Continues to Center Around Homeownership

Making the choice to purchase a home is a significant decision, and it continues to be a fundamental aspect of the American Dream. Unlike renting, owning a home signifies more than just having a place to live – it provides a feeling of belonging, stability, and freedom. According to Nicole Bachaud, Senior Economist at Zillow:

"The core of the American Dream remains rooted in home ownership. There is a significant demand for owning a home, and this desire is enduring."

Let's examine a few reasons why many Americans consistently place value on homeownership.

The Economic Advantages of Homeownership

A potential explanation for the elevated regard for homeownership is its role as a substantial tool for building wealth. This might be the reason Jessica Lautz, Deputy Chief and VP of Research at the National Association of Realtors (NAR), states:

"Owning a home stands as the primary method for accumulating wealth in the United States."

As the years pass, homeownership not only contributes to the growth of your personal net worth but also establishes a foundation for the success of future generations as you pass down that wealth. Habitat for Humanity provides insight:

"In essence, homeownership fosters the accumulation of wealth by serving as a compelled savings mechanism and through the appreciation of home values. Homeowners contribute monthly payments that enhance their equity by reducing the principal balance of their mortgage. Moreover, owning a home encourages intergenerational homeownership and wealth building. Offspring of homeowners embark on homeownership sooner, thereby extending the timeframe during which they can amass wealth..."

It also offers significant 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-Monetary Advantages of Owning a Home

However, home ownership extends beyond mere financial advantages—it also contributes to your social and emotional well-being. Your residence evokes feelings of accomplishment, highlights, and more. In a recent survey, Fannie Mae highlights some of these emotionally-driven benefits, including:

"The foremost three factors included having control over your living space (94%), experiencing a sense of privacy and security (91%), and having a suitable environment for your family or raising children (90%)..."

What Does That Mean for You?

If your vision of the American Dream includes increased freedom, security, and prosperity, homeownership could play a crucial role in realizing that dream. With mortgage rates currently declining, it could be an opportune time for you to contemplate making a move.

If you're prepared and capable of making a purchase, be aware that there are remarkable rewards awaiting you at the conclusion of your journey. You'll acquire more than just a residence – it's a space to cultivate your wealth and claim as your very own. As stated by Ksenia Potapov, Economist at First American:

"...owning a home continues to be a significant catalyst for amassing wealth and stands as the primary source of total wealth for the majority of households."

Bottom Line

Making the choice to purchase a home is a impactful decision and a fundamental aspect of the American Dream. If making your dream of finding a place to call your own is on your agenda for this year, reach out to a local real estate advisor to kickstart the process today.