Strategic Diminshment at the Heart of New Housing Policy

Robert Samuelson in the Washington Post takes on the role of homeownership in our society. I'm generally a fan of Samuelson's writing, a normally sober, cold-eyed analysis of issues without favor to one ideology over another, so imagine my disappointment when reading him say, "The relentless promotion of homeownership as the embodiment of the American dream has outlived its usefulness."

Of course, there's more to his column. He goes on to say:

Unfortunately, we let a sensible goal become a foolish fetish. Not everyone can become a homeowner. Some are too young and footloose; some are too old and dependent; some are too poor or irresponsible. Some don't want a home.

This is different that saying homeownership is not a worthy goal for our nation and is quite distinct from the ideas of Richard Florida, who has previously written that homeownership is overrated and who’s recent "Roadmap" to recovery focuses on de-emphasizing homeownership. Where Florida is right is in acknowledging that this would "blow up" the fundamentals of our economy.

He's also engaging in what I call strategic diminishment – that is, consciously pursuing a future that is less than our current state. Many elite progressives think we have it too good and that our lifestyle choices are harmful to ourselves and our planet. It's not enough that they want to be scolds; they want to use the power of government to change America into a place where our quality of life is diminished.

And progressives also glorify this reduction with a "less is more" attitude. The Washington Post recently presented the case against air conditioning, and USA Today reported on the banning of drive-throughs in the city that pioneered them sixty years ago. I've addressed strategic diminishment as it relates to the mobility and the Obama administration’s “Livable Communities Act,” but this is also true for homeowners and covers not just the percentage of homeowners but even the size of homes. Ron Utt of the Heritage Foundation warns how even the President has adopted a worrisome narrative on homeownership.

Before we go off the deep end, let's clear up two points. First, the crisis we've gotten ourselves into is not because people own homes. It's because of the flawed policies promoting homeownership. We know about the role of the Community Reinvestment Act and Fannie Mae and Freddie Mac, but also contributing were various land-use planning schemes collectively known as Smart Growth.

Second, homeownership has many benefits. Homeownership is more than a lifestyle choice; it's a source of wealth and stability. And when homeowners take out a second mortgage on their homes, it's often as a source for financing their own small businesses – another ideal we associate with the American Dream.

There are countries with equal or greater rates of homeownership that do not have government intervention policies that skew the market. But as we consider housing policy at the local, state, and federal levels, what should be the principles on which it is based?

  • Owning a home is a laudable goal held by millions of Americans.
  • Homeownership is positive good that should never be discouraged by government policy.
  • Everyone should have the right to pursue homeownership, but not everyone is ready to be a homeowner.
  • Government’s role is not to determine who should be a homeowner or when and where they should buy a home.
  • Markets are better than mandates at creating the environment in which people pursue renting or owning homes according to their ability.

Before we adopt A Nation of Renters as our new creed, let's fix the broken policies that got us here.

Ed Braddy is executive director of the American Dream Coalition, a non-profit grassroots and public policy organization that promotes freedom, mobility, and affordable homeownership. The ADC's annual conference takes place September 23-25 in Orlando, Florida. For more information, visit or email Ed at

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Homeownership and our mobile society are not congruent.

Given that real estate essentially has a private 10% transfer tax imposed on it, the brokers fee, survey, credit report, report on this that and the other thing, title insurance, lawyers fee... owning really takes 7 or more years of living in a place to make financial sense. This of course is not the way a lot of people are living. Perhaps we need to bring back the advice that if you are not planning to stay 7 years do not buy a house. If you move more often than that any real equity you hold is payed to the real estate industry. As a result home ownership is not an efficient way of saving, putting money in CD's would do better. In the old days this concept was emphasised but because there are so few that expect to stay long the concept had to be buried. (If a corp move then the company eats the fees so its not as bad)