A Discussion of Why the “American Dream” and Homeownership Are Tied Together, and the Many Benefits of Homeownership

 

On The American Dream

Though the origins of the “American Dream” as an idea are somewhat in dispute, most historians agree that the term itself was first coined by an author named James Truslow Adams, in his book The American Epic. As a concept, the American Dream refers to the collective belief of America itself—as professed by writers, politicians, artists, and other national figures—as a place (and an ideology) where people can come to achieve prosperity and have a fair and equal chance at happiness and success. It is, after all, articulated in the United States Constitution that not only are “all men created equal,” but that all Americans are entitled to “prosperity” and the “pursuit of happiness.”

This is, of course, an oversimplification of a very complicated idea that changes subtly over time. However, the essence of this concept has stayed static pretty much since the founding of our nation. The reality of America as an idea, the things we profess to believe are the core makeup of our country’s moral compass, is obviously complex. To this day, we wrestle not only with our historically troubled past, but our present day woes, which, sadly, still very much mirror our past.

Still, the important thing to realize is that there are elements of the American Dream as a concept that are indeed true about our country. Regardless of one’s political beliefs, all Americans tend to at least agree that there are opportunities here that do not exist elsewhere. That there are freedoms here that do not exist elsewhere. And that there are ways of life here that do not exist elsewhere.

What binds us as a country is that, regardless of our political, spiritual, or philosophical leanings, we all want the same things for ourselves: to be healthy, to be successful, to be treated fairly, and to provide for ourselves and our families in a place that is safe.

For me, the American Dream is simple: each generation does better than the one that came before it. My parents fared slightly better than their parents, and I did slightly better than mine. My daughter, who is doing better than I did at her age, hopes that her children will do better than she has. The American Dream is about upward mobility—and generational improvement—no matter how incremental. This, to me, is the essence of the American Dream, and the reason why homeownership is so important.

It is not just that people like the idea of owning a home, though of course it is something to be proud of having accomplished. It is that there are so many benefits that come with owning a home that are difficult to articulate, but are undeniable. Homeownership gives a person access to things that are unimaginable to the renter or homeless person. This National Homeownership Month, it is fitting to take a moment to discuss some of the most important benefits of homeownership. Not only because we want to celebrate how fulfilling it is to be a homeowner, but because we want to point out why it is so important that our mission here at AHP 75—to raise homeownership to 75% for all Americans regardless of income or background—is successful.

We are not just trying to raise rates of homeownership. We are trying to help people tangibly achieve the American Dream.

 

Little Pink Houses for You and Me

There is the stereotypical “house with a white picket fence, a family, and a dog” image that people often conjure up jokingly when asked about what the American Dream is. But, while people do often say it in jest, or as a quick way to define the somewhat overwhelming concept of the American Dream if you are forced to think about it and discuss it, there is certainly a truth to the importance of owning a home as an essential element of the American Dream. Because owning a home is the fastest way to achieve so many aspects of the American Dream, no matter how you choose to define it.

Owning a home is, on its face, something to take pride it. It is your property. A place to make your own. Decorate it. Make structural changes. Landscape. Make memories. All of these things are so much different when it belongs to you. As a renter, I did my best to make the places I lived my home, but in the back of my mind, I always knew it wasn’t my house. This is a subtle, but powerful, feeling. One that, once I became a homeowner, lifted without me realizing it was even there. When I owned my home, I was proud.

There is also the sense of belonging to the community. As a renter, I still got to know many of my neighbors and was friendly with them. I kept my home in good shape and did my best to make it my own, but I never felt like I was a permanent part of the community. In fact, people often asked me if I rented or owned, and the responses I received when I was a renter versus when I was a homeowner were dramatically different. The response when I was a renter was a kind, sort of dismissive nod, and then they would often walk away. The response when I was a homeowner was usually a moment where the questioner paused, took a moment to assess me a little more deeply, and then usually began to ask me more meaningful questions about my identity, my job, my family, and so on. I was taken more seriously by my neighbors as a homeowner. I was more involved in the lives of my neighbors. I volunteered and took part in community activities. I was a homeowner. Plain and simple.

But despite these nice feelings that came with owning a home, the real benefits (as I’ve outlined in several previous blogs) is that I was creating a better future for my daughter. If my version of the American Dream is that her life was to be better than mine, then I had succeeded. My parents only owned a home for a couple short years of my childhood. Her parents have owned homes the vast majority of her entire life.

More importantly, owning a home gives the owner a financial stability that is difficult to achieve with being a renter. For one, the money you are putting toward your mortgage pays down the amount owed on the principal balance, and you gain equity (or true monetary value) in the home as it, usually, rises in value. That is a commonly known benefit to homeownership.

But, in addition to your home becoming an investment that rises in value over the years as you pay it off and inflation increases its monetary worth, the other financial benefit of homeownership is that, unlike rents, the amount of the mortgage payment stays relatively steady throughout the lifetime of the loan. This is not the case with rents, which can rise and fall dramatically through no fault of the renter. The renter has no control over the rise and fall of rent. And rents are most often always rising, rarely falling. Besides the mental and emotional impact of housing cost stability that comes with a mortgage (versus rent), there is the fact that it is far easier to make a budget and stick to it when the largest cost for the vast majority of Americans—housing—is steady.

Then there is the fact that one day the home is paid off. Not only do you now own an asset that can be passed down from generation to generation, you now have freed up the money that used to go toward house payments to save and invest elsewhere. So, too, do your children never have to worry about housing costs in their budget if you pass your home along to them. It grows wealth as you pay it off, and it grows wealth even faster when you pay it off and have more income to focus into other areas for future financial gain and stability.

There are, of course, so many more benefits to owning a home beyond those listed here. But these are among the most important. So, for those Americans who are blessed enough to be homeowners during this National Homeownership Month, take a moment to determine the benefits owning a home has brought into your life. For those Americans seeking to become homeowners, visit AHP 75 to learn about our initiative and the many exciting and attainable services we offer to help you become a homeowner and begin your own celebration.

The American Dream is many things to many people, but owning a home is the one aspect we believe is within the reach of everyone. We believe it is not only a dream, but a right.

Are you ready to become a homeowner? Visit AHP75.com to learn about our homebuyer programs designed specifically to help you join the ranks of homeowners and get onto the path of financial stability and wealth generation.


Aaron Morales is the Social Justice Writer for AHP 75, based out of Chicago, IL.

amorales@ahp75.com