By Gino Blefari, President & CEO, Intero Real Estate Services, Inc.
Homeownership is a value that seems to be under constant assault in the media. Between the recent Nobel Prize winner who claims that owning a home is a bad investment to the frequent reports that our younger generations aren’t equipped to buy homes, you’d think the real estate market was tanking.
That’s why a recent survey of the ownership attitudes of delinquent borrowers caught my eye.
Fannie Mae’s national survey finds that delinquent mortgage borrowers’ views toward the housing market have become more favorable in 2013 compared to 2012, and the majority believes in the personal and financial benefits of homeownership.
This is significant news because this is a group of owners whose views on housing we would assume would be negative because of the bad feelings associated with falling behind on house payments.
But in 2013, delinquent borrowers’ attitudes were positive overall and moved closer to that of the general population. The survey found that this group expects home prices will go up; they believe buying a home is a safe investment and say that it’s highly likely they’ll buy a home on their next move.
Specifically, 67% of delinquent borrowers say buying a home is a safe investment, which is exactly the same as the general population.
In addition, 74% of delinquent borrowers say that they’re better off owning a home than renting when it comes to building up wealth, compared to 82% of the general population and 90% of the general population with a mortgage.
In the early days of the downturn, there was a lot of speculation about how the foreclosure wave would impact consumer confidence in housing in general – especially for younger generations who may have witnessed their parents go through foreclosure or short sale, and those borrowers who’ve either gone through foreclosure or come close.
Fannie Mae’s in-depth look at one segment of borrowers who have been personally affected by delinquency is worth some discussion. If this group’s attitudes are still bullish on housing, then I think we’re in good shape in terms of the value placed on owning over renting.
We’ll continue to watch consumer attitudes because it’s a telling statistic that upon examination often reveals that the American Dream of owning a home is once again alive and well.