ABSTRACT
This chapter examines the significance of homeownership in American society, changes in homeownership patterns over time, the benefits and pitfalls of homeownership, and how we as a society manage and encourage homeownership. In 2014 nearly 73 percent of white households owned their homes, while only 45 percent of Latino households and 43 percent of Black households were homeowners. Often referred to as "subprime" loans, these mortgages were developed to provide loans to people with more credit risk—traditionally people with FICO scores below 640. Three sets of debates surround the role of homeownership in American society in the wake of the housing crisis. First, is homeownership personally, economically, and/or socially beneficial? Second, is the American housing finance system functional and sustainable? Finally, should the US government encourage homeownership, and if so, how? There is no better example of the rise—and perils—of the financialization of homeownership than the recent home foreclosure crisis in suburban Modesto, California (CA).
