Homeownership - more than gender and race - help Americans feel confident

In a recent interview with CNBC regarding the current housing market and homeownership rate, a self-made millionaire and published financial author made the claim that an average homeowner in American today is 38 times wealthier than the average renter. This has what many often call the American Dream – if you have made it in this greatest country in the world, you get to own a piece of its land.

But in recent years, since the housing crisis, this notion has been challenged, and some of the people who have fared most poorly and had the toughest time surviving the financial crisis were Americans who owned homes in 2007-2008. We wanted to know how today’s Americans feel about their wellbeing and how it relates to homeownership, and designed part of our latest ValueInsured Modern Homebuyer Survey to explore exactly that.

In our recent Fall 2016 quarterly survey, we learned Americans who own homes feel most confident about their socio-economic status, and are most likely to self-identity as “upper class” or “upper middle class” when given a range of selections of socio-economic categories. They are also most likely to feel confident they can reach their “American Dream”.

Renters, on the other hand, are more likely than homeowners to self-identify as “working class” and “lower class”, and are less optimistic about their chances of reaching the American Dream. What is particularly interesting is that even after adjusting the results for gender and race identification factors – two demographic self-identifiers that sometimes affect respondents’ self-perception of socio-economic wellbeing – homeownership is still the defining factor that most strongly determines how one feels about his or her social-economic wellbeing. 

Some of the highlights of our recent survey include:

  • 39% of all homeowners surveyed self-identified as “upper class” or “upper middle class”, compared with 7% of renters and 22% of all Americans who said the same
  • 47% of all homeowners surveyed self-identified as “middle class”, compared with 39% of renters and 41% of all Americans who said the same
  • 6% of all homeowners surveyed self-identified as “working class” or “lower class”, compared with 32% of renters and 19% of all Americans who said the same
  • 88% of all homeowners believed they have or can achieve the American Dream, versus 54% of renters and 70% of all Americans who said the same; among all segments, Millennial homeowners are particularly confident, as 93% of them said they have or can achieve the American Dream

It is officially 2017, and it appears the American Dream is still alive and well. Nearly 3 in 4 (74%) Americans surveyed believe the American Dream is personally relevant to them; 79% (including 83% Millennials) believe owning a home is an important part of that dream. With this cornerstone American ideal seemingly alive and well, and continues to be embraced among Millennials, we expect to see homeownership status will continue to be a strong determinant of Americans’ sense of wellbeing. We don’t know for certain if homeowners are 38 times wealthier than renters, but it does appear homeowners feel confident they are faring better.