Why is "owning a home" such an essential part of The American Dream™?

With the failure of the Reagan Revolution/Friedman-laissez-faire economics in the news, the conversation always veers toward the mortgages and home-ownership without regard for why.

The blame for the banking failures is being placed on the sheer number of mortgages in default never considering what is behind the desire for home-ownership. We know the motivation for the banks and lending institutions: they're greedy, soulless assholes. But, why did so many people get those sub prime loans? Were they all tricked by advertising? Did they not understand the details of the contracts? Or was it because "owning a home" means something more than just paying for a house?

It is my contention that the pursuit of the "American Dream™" played a big part in people's decisions to become home owners even if it meant going deeper into debt. And I believe the lending industry exploited this idea.

I see it as similar to why students take out loans to go to college. Millions believe that the debt is worth it because they will get a better paying job. Getting a better paying job doesn't always happen, but it is the reason why so many students take out the loans in the first place--they're hoping to get better paying jobs. (And--as an aside--I believe student loans will be the next target for GOP "reforms")

So, let me ask, why is taking on a 30-year(+) debt to own a home worth it to so many people? What is so important about owning a home? Why is "owning a home" such an essential part of The American Dream™?

A. "owning a home" is not an essential part of The American Dream™

B. wanting to own a home is not a factor in why so many people took out loans

C. both A. and B.

D. people are too materialistic, there is nothing wrong with renting

E. because it is a way to provide stability and security for one's family

F. Other, please see my reason in reply

What is so difficult to understand about that? What part of "not being in debt to The Man" is "materialistic"?

Do you ever hear anyone on TV talking about this?

Of course yes if you just finished paying it off. Its yours. But, how many people are about to lose "their"(?) homes.

That was our motivator. Why pay a higher rent when you can manage better with a lower monthly mortgage?

Then I factored in the costs of property taxes, utilities like water, sewer, and trash, home repairs and improvements, and the iffy economy/job market, and even though I'm a federal employee making more than $50K/year, home ownership just didn't make sense to me once I gave it some serious thought, especially given my inability to save thousands as my wages remain relatively stagnant (I have zero opportunity to be given a performance-based raise; it's all contractual COLAs and such).

Maybe I'll find a fixer-upper/foreclosed home someday that costs far less than "market value", but until then, I'm happy renting. In my current apartment (bottom floor of a house), I pay no electric bill and no gas bill, which means no heating costs. I can live with that, I think...

stop and think about it, the rent must allow for the landlord to pay all those things you mention and on top of it take a profit

unless your landlord is a fool, your rent is higher over your lifetime than mortgage will be

it's pretty basic math

we were able to pay off our mortgage in 9 years on a relatively low income by national standards, we would be able to pay off our rent...in never

when we were old and living on social security, our entire check would not be enough to cover TODAY'S price of rent!!!!

if you plan to live into old age, renting just don't make sense

I know someone who bought his house around 1991 and paid $35,000 (in IA). He finally sold it for not much more than that! Not all markets mean a jump in value. And so yeah, for you it's worth your while, but if you live in a place where the mean price is between $275-375K, it's very difficult to swing that on a lower salary. And don't forget all the expenses: upkeep, insurance, taxes, interest on your loan...You can still rent a HOUSE for about $600 in some college towns. I'd rather do that...

I could never pay off my rent "any day now." I'm unclear of any American dream but not having to write a check every month to have a roof over our heads is a nice goal.

Back when Mr. H was a consultant he had a particularly good year one time and we decided to dump all the "excess" into the Principal on our mortgage. It put us years ahead. In fact we put some extra on the principal every month come rain or shine.

This is no investment. It's where we LIVE.

Hekate

In addition to being a long-term investment in stability and security.

Thus, they wouldn't have rent to pay and could live on
less (maybe even just what Social Security was paying
them).

Personally, I see the idea of "retirement" at all
slipping away. I don't own a home, probably never
will, and with my 401(k) going down the drain, the
best I can do is probably find something I enjoy
doing (and can continue to do as I age) so that I
can just keep working ...

Which may not be a bad thing, actually. I've known
a lot of people who lose their desire to live once
they have no reason to get up in the morning. The
key is find work that you enjoy doing.

Most 401k and IRAs allow you to move your money to safer and more conservative investments. I did that with mine because I felt no patriotic obligation to sit and watch my investment funds disappear.

which means I don't have as much as I might have, but I
haven't lost as much as some have recently.

The 401(k) part of my post wasn't the most important,
though, because if I'm still paying rent at an ever-
increasing rate by the time I'm eligible for retirement,
even my savings won't be enough to support me. If I
didn't have rent at that point, I might be able to
retire but the difficulty in buying a home these days
is making it harder and harder for me to envision
being able to quit working. Rent is a BIG chunk of
my expenses and will remain so for the foreseeable
future.

Home buyers did not cause this crisis. And it was just one of many levers that these assholes played, as far as I can tell.

What is no surprise at all is that they are blaming poor and especially poor black people for this mess. That should tell you all you need to know.

I am however, wondering why the lending industry exploited people's need for home ownership. Already DUers have posted good reasons for home ownership. The one I like is the one about how in the long run it will cost less. I also like the idea of being able to retire without having to pay rent every month.

I am also wondering why the Punditocracy seems to have no problem blaming working people for the failures of the Reagan Revolution/Friedman-laissez-faire economics.

I just think that by asking why so many people wanted the American Dream™, we can better understand why so many were exploited and possibly figure out why blaming them is acceptable.

Most mammals want a safe living area. So, asking why people want to own their homes is a little like asking why they want a safe food supply or a reliable source of water.

You're asking at the wrong end of the food chain, imo.

People are being blamed for wanting the opportunity to own their own home.

When the question is framed that way, how can anyone in their right mind blame people for wanting their own home?

I see what you mean, now.

Even with taxes and insurance, it's only a little bit more than rent was costing us.

For us, that was a main reason to buy. But stability and security were the number 1 reasons.

Predatory lending has got to become a prosecutable crime, imo. But absent predatory lending and unregulated markets, a person who saves diligently and strives to avoid unwise debt should be able to get into their own small home if they want to. Affordable housing in my area is nonexistent, though, so it's a tough issue in regions like mine.

Regardless, what I'm saying is that one reason it is part of the American Dream is its tangibility.

Hekate

It is seen as a security thing, and independence.
Also often as a good long term investment.

Plus I like shouting 'hey you kids, get off my lawn!'

Sometimes we talk about giving up our house for a condo, but said condo would have to come with some mighty thick walls.

Hekate

Okay, I don't do the "get off my lawn" thing. I'm a big fan of fences. :) But it hasn't been so long ago for me that I had neighbors living right up against my walls - and though they were nice enough people, their mere proximity was intolerable. I could hear their comings and goings, and even worse, I knew they could hear mine. I felt under seige all the time. After I finally moved out of there, I could honestly say that I would rather be dead than live in such close quarters with humans again.

Once you get to a moderate level of income, the federal income tax standard deduction isn't very helpful for reducing your tax owed. The tax code allows a deduction for both interest and real estate taxes if you "own" your home. This was a significant reason for me to buy my first home and to continue to buy a home over the years rather than rent.

By giving people the sense that they have a stake in the plantation, they will reliably side with the masters over their fellow slaves. They are less free and less secure and less stable owning, not more. Debt slavery is not security. Very few can make the game work for them.

How is owning one's own home not freedom?

Unless your mortgage is paid off, your house is merely on layaway.

Is one still a bank slave even then?

You were free before you signed the mortgage. Why make payments for decades to get back where you started?

Fuck!

Nobody warned me about that!

Escaping the landlord is the motivation.

What you are looking for is an illusion. Whether you own or rent you are answering to someone.

You don't have to go back to renting when you pay off your mortgage, but you are responsible for insurance, repairs and taxes. Hardly total freedom there.

How IS it freedom?

endless acquisition and material possessions. It was the PR machine of the Robber Barons of the 19th century that created this perversion of our national intent.

Other.

In my area there are many people who were into buying older homes, doing some cosmetic work (the minimal amount of cosmetic work usually), and then flipping the house for bigger prices. And many were being talked into dubious loans because mortgage brokers were telling them they WOULD get a loan, don't worry about the balloon payments, you'll have it sold before it hits, etc.

And then the bottom dropped out of the market. And the mortgage brokers didn't give a shit - THEY'D gotten their money - and with the market going into the crapper, they *couldn't* do anything for the folks who had been talked into the fast flip greed cycle.

How many TV shows are on that are totally based on the flipping concept? People have gotten out of the habit of buying a home they can RETIRE in - they are brainwashed into thinking *I'll get this one, do a little work on it, and in 5 years I'll sell it and walk away with 30% profit*. Always going for the bigger, badder carrot on a stick.

Now many of those *projects* are getting foreclosed on, and the owners who had been told *it's easy to do this* are stuck with ruined credit ratings. Losing not only the project, but possibly even their own homes, IF they used that as collateral for the *project*

Do they deserve this? You can't broadbrush everyone - I'm sure there are people out there that weren't making a career out of flipping houses.

But I CAN point a finger at the mortgage brokers who set out to do this - AND the banks that went along with it. De-regulation just gave the keys to the henhouse to the foxes, lots of them.

Greed and stupidity is the only real constant in this sad event.

It is one of the things I hate about the way real estate is handled.

I remember hearing an author on TV discuss how the planet is fast becoming a slum.

I don't remember the author's name or the book, in fact I can't remember if it was a man or a woman, but the author said something that has stuck in my head: he (or she) talked about the concept of buying up houses in a market (for flipping, etc) as similar to "poaching."

The image of houses being hunted and poached by predators can describe what we're seeing now precisely.

all the time?

We've been there and done that. Owning a home that no one can ever take away from you is everyone's dream.

Is the ricki tiki suburban landscape with its pesticide runoff, long commutes and high energy consumption really such a great deal?

Also why should a house be considered an investment when every other conceivable purchase an individual makes immediately begins depreciating upon first use?



Carpenter ants, termites and mold add nothing of value. All hail the ever swelling and crushing mass of humanity :sarcasm:.

There was some serious post-WWII "marketing" of the idea of "conspicuous consumption" to the people of the US.

I leave those interested to google around for some of the marketing tactics used and who sponsored many of them - and, yep, the federal government was also involved. The "Rosie the Riveter" campaign was one such - follow that campaign to the post-war change-over to send women back into the "new, improved, modern, mechanized home."

To quote a now-deceased friend of mine; "You want to own a man; give him a mortgage." Based on some of the practices of lenders, brokers, and banks I read and heard, some of those loans were damned near "given" to the borrowers. Of course, many of those people no longer have a mortgage but they have the ball-and-chain of bad credit that they'll be dragging with them for years or decades to come. Yep, they got "owned" allright.

Before someone says so, no I don't think a group sat around a table and created a vast conspiracy; I think there were a lot of opportunistic vultures who didn't give a rat's backside how it would effect anything but their "bottom line." No foresight whatsoever; just short-sighted greed.

It's like the difference between TIVO with the "lifetime service" contract and shelling out $12 a month forever...

I'm 24, and I've moved 10 times since I turned 18. I want somewhere where I can get my stuff out of boxes and make my own rules about nails in the walls. I don't want to have to deal with terrible neighbors getting evicted, I'd like to own a grill, and I'd like to have my monthly housing budget building my equity, not building equity for the landlord. I don't want to have drunk college neighbors yelling in the courtyard a 3AM on a worknight.

I don't even want a big house. There are adorable, perfectly floorplanned houses that I have my eye on for 180k or so. 3 bed, 2 1/2 bath, unfinished basement for a brew room... Nothing so big that I need a maid to help me clean, just a nice little house for my husband and I. I want to paint the walls something that's not institution white, I want to have nice furniture that won't get dinged up when I have to move in 6 months. I want to have a washer and dryer so I don't have to worry if the last person at the laundromat used bleach.

LOL!

Actually, I love your answer!

Especially the part about the nails in the walls.

I remember renting an apartment when I was younger and thought it would look really cool to paint a Marilyn Monroe silhouette on the wall near a floor grate. You know the pose where her skirts go up.

It would have been so cool, but the landlord pooh-poohed the idea.

The guys in the apartment next to us got evicted for doing graffiti style art on their walls. They were working for a painting company, so they had the tools to just paint it back when they were ready to move, but apparently the management didn't really like it.

The same management that ok'ed a deranged maniac to live in the complex. Cause they don't do criminal background checks, or even warrant checks, they do financial checks only. This nutcase stabbed the guys with the graffiti and their friends one night. Among the 5 who were injured, one was stabbed 40-odd times (one stab punctured his heart and he was dead for a while and has gnarly awesome open-heart surgery scars), one 30, and he got the others 6-10 times each before they took him out. And it took their entire party to beat him into a less-stabby consiousness. The crazy guy had warrants out for violent crimes in 6 states, and felony convictions in two. He was sleeping in an inflatible raft that was halfway between his bedroom and living room, and his pillow was white undershirts cut into 1'x1' squares in a gallon freezer bag. The landlords also tried to charge the neighbors to have the carpet cleaned, because it had so much blood in it. I'm looking to move out of this apartment complex.

But, if you move think of all the free entertainment you'd be missing!

Owning your own home has been about as solid investment that the average person can make. When you retire if you own your own home you have a big leg up.

I am making extra payments on my mortgage (when possible) so I can retire that debt, then retire myself.

Once the mortgage is gone, I can take odd jobs to make ends meet - along with my paltry pension, SS, 401k, and anything else I can scrape together.

Living on saltines, bananas, and tuna fish might not be so bad, either.

I am 50, but wanted to retire at 11.

and keep some bank happy. I owe, I owe, it's off to work I go.

Bill

F being "No more asshole landlord, ever".

What's the point of working at all if I'm not going to ever own anything at the end of it? I suppose the landed gentry should be the only ones allowed to own anything? We should all be renters in perpetuity down through the generations? :shrug:

the land gives you one place on earth no one can push you off of.

of security or serve as a good investment. I am part of the latter group. I was wrong. Oh well.

it's fairly basic and is reflected in such sayings as "a man's house is his castle," but your apt. is not a castle if your fuckwitted, ass-raping landlord can come into your house at any time

sleep on it and you'll figure it out

if you don't even own the roof over your head, you're not free and never will be

I wouldn't call it essential, but it is statistically inescapable. People who think they'll never want to own a home are rare, I think.

... only those (white men) who owned property were considered citizens/able to have a vote-voice etc.

So home ownership is equated with having a true stake in one's community/rights/a voice, etc.

Now, that may no longer be necessarily true but ... so many of the 'original myths' of America have been convoluted and turned into slogans when needed.

Personally, I agree with the person who commented that 'ever having to share a common wall with another renter ever again is too soon'. After 20 years of renting, having my own home with peace & quiet, no funky smells or sounds or strange people wandering around at all hours ... it's priceless.


:hi: