The attitude among American when it has come to owning a home has changed radially, according to Fannie Mae.

“A majority of Americans (67 percent) continue to believe that buying a home is a safe investment, although this is down three points since January and 16 points since 2003. Housing ranked second behind putting money into a savings or money market account (76 percent)”, the study shows. The data is compared to a similar study in January.

It appears that owning a home has become less and less of an American aspiration as more and more Americans watch the value of homes drop and foreclosures and repossessions rise. Thirty-three percent — up from 30 percent — of all respondents said they would be more likely to rent their next home if they were to move.

It has suddenly occurred to many Americans that homes are no longer likely to appreciate in value as they did for generations which provided money for things like retirement. And, the view of many people is that the current housing situation will keep those who might have bought homes in the next few years, or even decades, out of the market. As the study notes, “Seventy-one percent of Americans think buying a home will be harder for the next generation, up three points since January. ”

If this forecast is correct, the housing market could remain depressed for years as potential mortgage-seekers remain on the sidelines, either because they believe that access to credit will be difficult or their salaries and credit ratings will keep them from receiving mortgages.

Among the other findings from the July 14, 2010 interviews of 3,399 Americans aged 18 and older:

• Mortgage borrowers (74 percent) and underwater borrowers (69 percent) are more likely to say owning a home is a safe investment than delinquent borrowers (57 percent) and renters (54 percent).
• Twenty-two percent of mortgage borrowers said they have reduced their mortgage debt significantly in the last year, and 27 percent of the mortgage borrowers say they have reduced their non-mortgage debt significantly.
• Most renters said they would be more likely to rent their next home if they were to move, increasing significantly from 54 percent in January to 60 percent in July, even though 69 percent of renters think it makes more sense to buy a home.

It seems that there is a shift in the attitudes toward renting a home versus buying one which is counter to the attitude that dates perhaps are far as the post WW-II era when housing was plentiful and affordable, bank loans were readily available, and Americans believed that they would buy a home in their 20s and own it until retirement or perhaps into old age.

Douglas A. McIntyre

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.