“Consider it this way: when Enron went belly up, shareholders ended up with nothing, but when the housing market drops, homeowners still have a house. And this benefit is tax-free.”
From a NY Times op-ed stating that while the recent American dream of getting rich by flipping houses that appreciate by 30% a year is dead, the older, original American dream—of owning a home because you enjoy living there and it is a sound but not outsized long-term investment—is very much alive. In fact, homeownership is within closer reach, and arguably a better investment than it was not long ago:
Do the math. Four years ago, the monthly payment on a $300,000 house with 20 percent down and a mortgage rate of about 6.6 percent was $1,533. Today that $300,000 house would sell for $213,000 and a 30-year fixed-rate mortgage with 20 percent down would carry a rate of about 4.2 percent and a monthly payment of $833. In addition, the down payment would be $42,600 instead of $60,000.