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So, I was at lunch yesterday, and Rep. Barney Frank was the speaker. (He's chairman of the House Financial Services Committee). He was quite entertaining, but, the question came from the audience re the House agenda on some matters, particularly subprime lending, and mortgage loans going into default.
His response wasn't what I would have hoped to hear - some legislation to rein in predatory lenders. Instead, he said "home ownership is largely overrated. It shouldn't be the goal of every American to own a home - not every American NEEDS to own a home. And the tax benefits are overrated too - many homeowners are so poor that they cannot take advantage of the tax benefits. So we shouldn't be encouraging people to buy homes - and that takes care of the subprime problem".
Then, he said "spending time focusing on helping poorer people buy homes diverts attention away from spending time on fixing rental problems". To my amazement, two gentlemen from the Italian embassy sitting next to me started nodding vigorously in agreement. (Outside of everything else, why do THEY care???? They're here for their four year assignment or whatever it is and then back to their home country...)
What's wrong with this man? How could anyone - other than perhaps those who are single, mobile, and undecided as to their career path - or perhaps those who want to invest in other things and stay as fluid as possible - NOT want to own a home?
In my opinion, it's one of the key anchoring positions in the climb out of poverty. I bought my home as soon as I could - when D was still in grade school. The first year of ownership, some months I couldn't afford to eat very much, and we didn't have any furniture in the main rooms for the first couple of years - we had minimal, cheap bedroom furniture and a place to eat meals and that was it. But it was an important stake in the ground along the way towards financial stability and then later financial comfort and today towards potential affluence, and, the mindset and social positioning are critical life building blocks.
I cannot get my head around this man's thinking. So his position is that poorer Americans should pay their money to slumlords, and rent forever? As opposed to having a piece of property that is theirs, to care for, potentially improve, build equity, and pay off, and perhaps even have something for their children to inherit?