Mulling a Long-Term Drop in Homeownership Rate
American Banker
By Harry Terris
... If Arthur C. Nelson is right, the homeownership rate is headed for a seismic shift that will reduce it to levels not seen in a generation. That may be just as well in his view - and those of other experts who are likely to help shape the debate over housing policy. For Nelson, the director of the Metropolitan Research Center at the University of Utah, the devastation of foreclosures and demographic changes mean it is time to rethink the primacy of homeownership in housing policy...
... Richard Green, the director of the Lusk Center for Real Estate at the University of Southern California, offered a variation on the wealth-building argument, one that Nelson acknowledged has some merit: homeownership as a form of "forced savings."
Green said that a home may not be "as good an investment long term as, say, the stock market," but "when people have a self-amortizing mortgage, they build wealth" by making their monthly payments. "We know that people are much more likely to save if it's a default that they save."...