The benefits of homeownership

The nationwide housing affordability crisis has placed homeownership and public policy near the top of the national agenda. While most of the commentary has been focused on how government policy affects housing supply, other dimensions to the housing affordability issue receive less attention.

There are numerous benefits associated with homeownership that go beyond putting a roof over someone’s head. First, homeownership promotes social mobility and remains a powerful conveyor belt to the middle class. Second, homeownership is associated with a raft of economic and social benefits, such as better educational and health outcomes, more cohesive families, safer communities, and greater wealth accumulation.

Listed here are some key highlights from the existing body of research:

1. Homeownership reduces criminal activity.

A study conducted in 2009 by academics Jinlan Ni and Christopher Decker analyzed the relationship between homeownership and criminal activity. The study noted that “homeownership itself has a strong and statistically significant negative effect on both violent and property crime rates.”

2. Homeownership enhances quality of life.

A post-recession update to past research on the broad social and economic benefits of homeownership by William M. Rohe and Mark Lindblad concludes that “there is considerable evidence that positive homeownership experiences result in greater participation in social and political activities, improved psychological health, positive assessments of [neighborhoods], and high school and post-secondary school completion.”

A 2012 study commissioned by Habitat for Humanity Toronto came to similarly positive conclusions in its assessment of the social impact of housing. After achieving homeownership

  • 95% of respondents said their families were stronger
  • 81% reported an improvement in their children’s social life
  • 76% reported an improvement in their children’s grades
  • 72% reported strong community and neighbourhood ties
  • 50% said they felt safer and more secure

3. Homeownership fosters wealth accumulation.

Homeownership is a major driver of overall household net worth accumulation. A 2015 report by TD Economics found that housing is responsible for about one-third of the roughly $6.6trn increase in overall household net worth since 1990.

Clearly, society benefits when families have access to affordable and responsible homeownership. Thus, government policy should continue to support it.

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