Real Estate Articles
June is National Homeownership Month
June is National Homeownership Month when Realtors promote the benefits of homeownership and recommit to creating opportunities for future homeowners. Owning a home is a financial investment and brings value to families, communities and neighborhoods across the country, says Jim Hamilton, president of the Silicon Valley Association of Realtors.
"Realtors strive to ensure all Americans have the opportunity to achieve homeownership. Owning a home is the centerpiece of the American Dream and the pathway to economic well-being and intergenerational wealth-building," says Hamilton. "Along with home equity gains and overall appreciation, the mortgage interest rate and property tax deductions are tax advantages."
Hamilton adds, "When more people own homes, everyone benefits. When you own your own home, you become more invested in your community. Homeowners get involved in community activities such as volunteering and participating in community events. This gives them a sense of belonging more than someone who is renting."
A Bankrate Financial Security survey of 2,545 U.S. adults conducted in late March found 74% of Americans consider homeownership a key component of the American dream, outpacing retiring (62%), having a successful career (61%), owning a car or truck (52%), having children (42%), and getting a college degree (33%).
Owning a home as part of the American dream was most cited by the older generation - 84% of baby boomers (ages 58-77) and 76% of Gen Xers (ages 43-57), compared to 62% of younger millennials (ages 27-22) and 63% of Gen Z (ages 18-26).
In the last decade, middle-income homeowners have accumulated $122,000 in wealth due to price appreciation alone. However, a historic 50-year record shortage of affordable homes available for purchase has severely limited access to the residential real estate market.
A report commissioned by the National Association of Realtors last year found the U.S. has developed an "underbuilding gap" of 5.5 million housing units over the last 20 years. This translates into a $4.4 trillion underinvestment in housing.
"The housing shortage is constraining homeownership opportunities for too many Americans," says Hamilton.
According to NAR, there are currently 280,000 homes listed for sale that middle-income families can afford to buy, a marked decline from 450,000 homes in 2019. For middle-income households, there is only one affordable listing for every 125 households, a stark decrease from one listing for every 46 households in 2019.
The Bankrate survey found more than any other age group older millennials said they are unable to afford the down payment and closing costs. Younger millennials cited not having enough income, home prices being too high, and not being able to afford the down payment and closing costs. Gen Z cited not enough income or just not being ready yet.
"It's simple economics. Prices rise when there's strong demand for a limited number of goods. We have to work on increasing housing at all price points. Only then can more people achieve the American dream of homeownership," says Hamilton. "NAR continues to work with the Biden administration, Congress, and industry partners on solutions to address housing supply and affordability constraints and increase homeownership opportunities in America."
The Silicon Valley Association of REALTORS® (SILVAR) is a professional trade organization representing over 4,000 REALTORS® and Affiliate members engaged in the real estate business on the Peninsula and in the South Bay. SILVAR promotes the highest ethical standards of real estate practice, serves as an advocate for homeownership and homeowners, and represents the interests of property owners in Silicon Valley.
The term "REALTOR®" is a registered collective membership mark which identifies a real estate professional who is a member of the National Association of REALTORS® and who subscribes to its strict Code of Ethics.
Variations of this article have appeared in local area newspapers.
For further information, please email or call the SILVAR office at (408) 200-0100.