Many news outlets, as well as economists, are saying “Homeownership is dead.”
While homeownership is at 62.9 percent – the lowest in 25 years – it’s not a cause for alarm. From World War II until 1995, homeownership hovered around 62 to 64 percent. We are simply getting “back to normal” after artificially stacking the deck with our “National Housing Policy,” which drove homeownership by lowering the standards by which consumers could get a mortgage.
We found out the hard way a few years ago, which was a disaster. What good is it to own a home if you can’t pay the heat, light and repair bills? The lenders sold the mortgage paper, so they were off the hook, but the taxpayers paid the price.
Homeownership rates have dropped, but not because of a lack of demand from the public. Rather, the homeownership bar has been raised to a level where it should be. The sky is not falling.
Pat Riley, President and CEO, Allen Tate Companies