Despite the adversities caused by the collapse of the housing market, most Americans still nurture the dream to buy a home, according to a national survey conducted by Fannie Mae in August and September this year.
Even homeowners whose home values have deteriorated and renters who could not afford to buy a home despite the drop in prices still have positive feelings about homeownership. One sign of the persistence of the American dream of owning a home is the still relatively high rate of national homeownership in spite of what happened to the housing sector. The homeownership rate indeed dropped from its peak of 69.2 percent in the fourth quarter of 2004, but the rate as of the third quarter this year is 66.9 percent, a still strong homeownership level considering the unending challenges faced by homeowners and prospective buyers.
When both homeowners and renters were asked if they were better off owning a home or renting, given their current finances, 74 percent said they were better off having a home. Of the respondents who were underwater homeowners, 84 percent said they still were better off owning a home. Of those with positive equity, 89 percent said they prefer having a home. Understandably, of the homeowners with no mortgages to pay, 93 percent of them like their current situation of having a home.
To the question of their possible purchase of a home when moving to another place, 62 percent of all respondents said they’ll likely buy a home while only 40 percent of renters would likely make a home purchase.
The top reasons given by renters why they could not take action in realizing their dream of buying a home are:
- Low credit scores: 52 percent of renters said their credit is not good enough.
- Lack of money to buy or maintain a home: 46 percent of renters said they can’t afford to buy.
- Belief that it’s not a good time: 43 percent of renters cited this reason.
Again, even with current difficulties, underwater and delinquent homeowners still intend to buy a home if ever they move. Seventy-three percent of homeowners with negative equity would buy a home while 78 percent of all mortgage holders would purchase a home.
The survey also affirmed the common contention that the realization of the American dream of home ownership occurs as people increase in age and income.
An individual earning $100,000 to $150,000 a year is 18 times more likely to buy a home than a person earning less than $150,000 a year. Similarly, someone within the age range 55-65 is more likely to own a home than somebody within the 25-35 age range.
All in all, home ownership is still the dream of most Americans amidst difficult conditions, but they’re now more aware of the risks and responsibilities that come with buying a home.