The American view of the financial importance of homeownership and awareness of the sacrifices it can entail appear to be shifting according to results of a recent survey released by the McArthur Foundation. Americans have a lessening conviction that homeownership is the path to financial security and many believe that finding affordable housing is a major challenge and one that the government should address.
The second annual How Housing Matters Survey was conducted by Hart Research Associates between April 8 and 14. Interviews were conducted with 1,366 adults, both renters and homeowners via both landline and cell phone. A deliberate oversample was pulled of renters and owners who spend more than 30 percent of their income on housing, an official benchmark of housing distress.
The survey found that even though economists and housing experts say the housing crisis is behind us, many Americans are not feeling the relief. There are indications that the public's views are shifting toward the positive, 51 percent feel we are still in the midst of the crises and another 19 percent believe the worst is yet to come. More than two in five adults (42%) believe the housing market today continues to be a serious problem.
Respondents showed an awareness that there are challenges for many in their community in finding affordable housing, whether to rent or buy. Almost three-quarters of those interviewed said it would be very challenging for persons living in poverty to find housing and 58 percent said it would be very or somewhat challenging even for families with average incomes to access affordable housing. Large majorities also thought young people starting out and families with children needing access to quality schools would be challenged in a search for housing.
Respondents also expressed concern about persons finding suitable housing as they aged. Two-thirds thought that seniors would have a difficult time locating housing either to meet their physical needs, their financial abilities, or to stay close to their support network.
More than one in six respondents believe that a family which is struggling to afford housing must make significant sacrifices such as taking an extra job or additional hours at work (82% very/fairly likely), stop saving for retirement (73%), accumulate credit card debt (72%), or cut back on health care (62%). A majority of adults (55%) believe it is at least fairly likely that such a family will have to cut back on healthy, nutritious food, and almost 2 in 5 believe such a family will likely move to a neighborhood that is less safe or has worse schools.
The report says that this awareness comes in part from personal experience. Fifty-two percent of all adults have had to make at least one such sacrifice in the past three years to cover their rent or mortgage. While half of all whites (49%) indicate they have made a sacrifice, nearly two-thirds of African Americans (63%) and Hispanics (64%) indicate they have done so. Among all adults, 47% report that either now or at some point in the past their housing situation was not "stable and secure," and among current renters, that figure is 56%.
Those renters and owners considered "distressed," that is paying more than 30% of their income on housing, have made many of these sacrifices at even higher rates. Some 62% of distressed owners and 3 in 4 distressed renters (74%) have made at least one of these tradeoffs in the past three years. Among those indicating distress in paying their rent or mortgage, 27% have stopped saving for retirement, 23% have cut back on health care, and 23% have accumulated credit card debt.
Most people who do not own a home still hope to do so. But while 70 percent of non-owners said they had such aspirations, homeownership is no longer viewed as the vehicle for building wealth that it once was. Sixty-four percent believe it is less likely today than 20 or 30 years ago that a family will build wealth and equity through homeownership. Only 50 percent believe homeownership is an excellent long-term investment and 54 percent think owning a home has become less appealing in the current environment and 51 percent think renting has become more appealing. Nearly six in 10 believe renters can be as successful as owners in achieving "the American Dream."
Largely because of concerns about affordable housing, 58 percent of respondents feel that government should be doing more to insure more of it - both to buy and to rent. Six in ten believe that "a great deal" or "a fair amount" can be done to solve the problem of housing affordability, including 70% of renters and 57% of owners. A solid majority (58%) wants the federal government to invest in both rental housing and homeownership while understanding there must be tradeoffs. Forty-seven percent favor elimination of the mortgage interest deduction for second homes and homes valued over $500,000 while 40 percent oppose this change. Those in favor of elimination believe that the money saved should be used for programs to increase access to low- and moderate-income housing."
The housing crisis that began more than five years ago has left an indelible mark on the attitudes and experiences of Americans," said Geoffrey Garin, president of Hart Research Associates. "Housing affordability has driven a large share of the American people to make significant financial adjustments. Concern and insecurity about the ability of middle class Americans to maintain their footing and for people to rise up into the middle class is a central theme in America today and this research shows that housing is front and center in these concerns."
