Homeownership Incentives: The Need for a A More Balanced Housing Policy
Balanced Housing Policy
The U.S. is on the cusp of a fundamental change in our housing dynamics. Changing demographics and new economic realities are driving more people away from the typical suburban house and causing a surge in rental demand. Unfortunately, our housing policy has yet to adjust to these new realities.
For decades, the federal government has pursued a “homeownership at any cost” housing policy, ignoring the growing disconnect between the country's housing needs and its housing policy. In the process, many people were enticed into houses they could not afford, which in turn helped fuel a housing bubble that ultimately burst and caused a global economic crisis.
The nation is now paying the price for that misguided policy and learning firsthand that there is such a thing as too much homeownership and that aggressively pushing homeownership was not only disastrous for the hardworking families lured into unsustainable homeownership, but also for our local communities and our national economy.
The ensuing single-family meltdown reverberated through the economy, taking down the entire U.S. financial system and causing a global economic crisis. If there is a silver lining in this situation, it is the opportunity we now have to learn from our mistakes and rethink our housing policy. Housing our diverse nation means having a vibrant rental market along with a functioning ownership market. It's time we adopt a balanced housing policy that doesn’t measure success solely by how much homeownership there is.
For many of America's most pressing challenges, from suburban sprawl to affordable housing, apartments are a much better solution. Apartments help create stronger and healthier communities by offering enough housing for the workers that businesses need, by reducing the cost of providing public services like water, sewer and roads and by creating vibrant live/work/play neighborhoods. They will help us house our booming population without giving up all our green space and adding to pollution and traffic congestion.
America is increasingly relying on rental apartments to house our citizens. The largest generation of children currently under the age of 20 in the history of the U.S. will be entering the housing market in the next few years and the number of seniors who can no longer maintain a house will begin to skyrocket. In addition, the foreclosure crisis has increased the demand for affordable rental housing.
Not only are apartments needed, but, fortunately, a growing number of Americans desire them. For generations, married couples with children dominated housing markets. But today those families make up less than 25 percent of American households. In their place are young professionals, empty-nesters and single parents who want the conveniences, amenities, shorter commutes and financial freedom that apartment living gives them.
NMHC/NAA call on lawmakers to enact a more balanced housing policy, one that respects the rights of individuals to choose housing that best meets their financial and lifestyle needs. NMHC/NAA urge decision makers at all levels of government to work with the apartment industry to craft a smarter housing policy that:
We call on lawmakers to reject proposals for new homeownership subsidies, including homebuyer tax credits and other ill-advised subsidies that only threaten to reinflate the single-family housing bubble.
Last Updated: January 2011
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