U.S. home ownership still strong, says study

November 16th, 2011

The stalled housing market has slowed attempts by aspiring homeowners to purchase homes, but that doesn't mean the U.S. will become a nation of renters, according to recent studies presented at the 2011 Realtors Conference & Expo. Home ownership will continue to be strong because, for many, there are substantial benefits over renting.

Benefits of owning a home

An analysis conducted over 31 years across 23 metropolitan areas examined the benefits of home ownership versus renting. The analysis looked at the benefits of appreciation and mortgage interest deductibility, as well costs associated with owning a home like a down payment, taxes, insurance and maintenance.

According to a statement by the National Realtors Association, Ken Johnson, editor of the Journal of Housing Research at Florida International University, said at the Realtors conference of his findings, "We knew that homeowners, on average, accumulate more wealth than renters. These findings indicate that home ownership is a self-imposed savings plan. Not everyone should own a home, but from a financial perspective, people who are planning to stay in a property over the long term can benefit from buying."

Another study found that housing affordability is at record levels. "Twenty-three states are at 30-year record levels of affordability based on price-to-income ratios, and all 50 states are at 30-year record affordability levels based on mortgage payment-to-income ratios," according to the analysis conducted by Johnson and colleagues.

Should you get a mortgage?

It can be tough in this housing market to decide if now is the time to pursue buying a house. But with homes at such affordable prices, it maybe time to get off the sidelines and start house hunting. A prequalification calculator can give you an idea of how large of a mortgage you might qualify to get. You can also use a down payment savings calculator to help with putting together a savings for your home purchases. When you use a mortgage calculator, keep in mind that the information should only be used as a guide. You'll need to actually contact mortgage lenders to get quotes that you can compare to find the right loan deal.

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