According to a recent article in the Wall Street Journal “It's time to accept that home ownership is not a realistic goal for many people and to curtail the enormous government programs fueling this ambition.”

In the Unitized States, our tax system currently subsidizes home ownership in the form of substantial write-offs.  Obtaining a loan in many European countries requires larger down payments (50% range); most homes are kept in the family and passed down, and in some instances parents help children with the large down payment required.

I don’t think home ownership has fallen out of style; I think there are many valid reasons to own a home:

1) Security (a renter can have their home sold out from under them)
2) Fixed rate mortgages provide a set payment; because of inflation, in later years these payments become very affordable
3) Creativity and Personalization: You can personalize your home to your taste, no need to ask permission

I owned my home in 1989, when I married George, a 2 + 2 in Glendale’s Northwest Brand Park neighborhood.  I was on a 15 year loan and my payment was $1550 monthly.  Had I not married George, and moved to a larger home, my house would be paid off by now.  I would be living rent free, just property taxes, homeowner’s insurance and maintenance.   Your home is not an investment, it is your security. If you make money over time, it is the icing on the cake.

I think our culture shift will be that less is more; we won’t “need” bigger and better homes every few years.  We will learn to be content with what we have; perhaps siblings can once again share bedrooms and bathrooms.  Buying and selling is expensive on each side of the transaction.  When homeowners stay in their homes longer, they build more equity.  I believe that owning a home is still part of the American Dream.

As long as interest rates don't skyrocket, I think there will be many opportunities for home ownership over the next several years: prepare yourself, save that downpayment, clean up the credit.