Editor’s note: The following guest perspective responds to the article, “Home ownership doesn’t add up for everyone,” which summarized a recent study by Dean Baker of the Center for Economic and Policy Research examining the effect of home ownership on low-income families. Baker argues that in some circumstances, low-income families may be better off renting than owning a home.

Dean Baker is not only sailing against the tide of popular opinion in arguing that many low-income families would be better off renting, his assertion flies in the face of good common sense and a whole house full of empirical evidence that indicates otherwise.

It is a well-established fact that home ownership contributes to neighborhood and family stability, adds to the family’s image and self worth, and most importantly, owning a home is the single biggest element in building household wealth for the average family.

Try telling a low-income family who has been displaced or evicted from a long-term rental home or apartment that because of rising property values and neighborhood gentrification they will be better off renting. What does a family have in the way of equity after 20 years of renting versus 20 years of paying on a mortgage? The answer is nothing!

How would Mr. Baker advise low-income families invest any spare cash or savings that they might be fortunate enough to accumulate? A savings account or the stock market? The return on savings accounts would basically assure that families would remain impoverished, and buying stocks today is practically akin to playing the lottery or betting on horses. Say, now there’s an idea, maybe we should have subsidies that make it less costly for low-income families to purchase lottery tickets as a form of investment. I am kidding of course, but that idea is no less absurd than the notion postulated by this study.

I suggest that this research is seriously flawed, and that Mr. Baker could use a strong dose of reality. There are no government programs that “push” low-income families into home ownership. The subsidies that exist developed over a period of years in response to the desires and demands of citizens and families who saw the many benefits and positive societal outcomes from home ownership.

Low-income families may not benefit immediately from the tax benefits attached to home ownership, but they most certainly will in the long run, just as assuredly as the majority of homeowners of all income levels will accumulate a measure of equity in the homes that they own.

The fact that home ownership does not work out favorably for all families does not undermine the notion that home ownership bestows benefits on the majority of home-owning families, regardless of their income levels.

Joseph T. Landers III is executive vice president of the Greater Baltimore Board of Realtors in Baltimore, Md.


What’s your opinion? Send your Letter to the Editor to opinion@inman.com.

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