While there are obvious issues with the practice of landownership, the corporate takeover of the residential real estate industry even worse for the common good. Writer David Grasso explains why in this article.
A Society of Renters Is the Anti-American Dream
By David Grasso
We’re starting to see a new notion that America should become a society of renters, and it’s a reminder that not all fresh ideas are good ones. America should not become a society of renters, and any supporter of this theory either has never rented or has an alternative agenda. The idea goes against centuries of tradition: Millions of people have landed here for life, liberty and the pursuit of happiness, the third of which was explicitly property ownership. Homeownership gives essential financial, societal and cultural benefits to owners—and mainstream impermanence is dangerous.
First, we’ve created a perfect storm in which housing has become very expensive. So arises the prevailing opinion that becoming a nation of renters is good. But the system is complicating the process of buying a home: Wall Street players—including hedge funds—are buying up starter homes. All the while, people are being encouraged to choose the path of long-term renting. This system is inherently flawed and could be very detrimental to society.
Of course, homeownership has immense personal financial benefits. As homes grow in value, which is practically guaranteed, it creates equity. You can then borrow against this equity for things like home equity loans. Homeowners also get deductions on taxes, including mortgage and property taxes. And we can’t forget capital gains. Ultimately, homeowners pay rent to themselves, investing in their future instead of a landlord or Wall Street hedge fund.
Homeownership also has societal and cultural benefits. First, homeowners have a much greater financial stake in their neighborhoods than renters, creating clean, safe and involved communities. Second, people who own their homes are much more likely to participate in local politics: When looking at voters who own versus voters who rent, we see a 35 percent increase in turnout in local primaries. Third, children of homeowners have better home environments, high cognitive test scores and fewer behavioral problems. Ultimately, homeowners have more stake in their neighborhoods and the future of their families, who will soon invest in homes and communities for their children.
This article was originally published on Yahoo! News.