You can’t always believe what you see, hear or read, even if it appears among “All the News That’s Fit to Print” in The New York Times and is supported by research by the new professional designation of “experts in happiness,” associated with such prestigious educational institutions as the Harvard Business School and the Wharton School.
This Sunday on the front page of the Real Estate section, the lead story called “Keys to Happiness. Or Not” reported that a growing body of research suggests that owning a home may no longer be the Great American Dream when it comes to happiness, and that renters may be happier because they have more time and money to devote to experiences, like traveling and dining out more, rather than buying homes.
Oh, really? I don’t buy it. Not by intuition or personal experience and, more practically, not by examining the samples or conditions of the research cited in this article.
It’s not because selling houses is my bread and butter and certainly I’m no researcher or psychologist, but coming from the marketing field, I know only too well that analysis of research can so easily be skewed to tell any story from a particular point of view.
The Times’ article reports that in gathering research for a book called “Happy Money: The Science of Smarter Spending,” co-written with an educator from Harvard, Dr. Elizabeth Dunn says, “People still view housing as a central component of happiness and a critical aspect of the American dream, but there is little research to support that.” My take on that? Just because no research has been done to support so obvious a premise doesn’t mean it isn’t so. Maybe no research has been done on the subject because, experientially, it is just something we all accept as being so right. Researchers sometimes fall victim to “the paralysis of analysis.”
Also, we must consider the time and place of the research One study cited for the article actually made me laugh. Conducted in 2011 by Grace Wong Bucchianeri, an assistant professor at the Wharton School, the research was based on a study among 600 women who live in just one geographic area: the state of Ohio. Ohio, you say? Can you guess what I’m thinking without my having to say it here? And what would be wrong with interviewing a few guys on the subject, even if only from Ohio?
The study found that the women there spent less time with friends and on leisure activities and reported that they felt some “pain” from home ownership. The report didn’t indicate what that pain was. I’ve spent some time in Ohio and I experienced some pain too, but it had nothing to do with the fact that I neither rented nor owned a house there.
One financial analyst who was asked to comment on the studies posited the view that the “nuts and bolts” of owning a home and being “house rich but cash poor” can override most of the perceived happiness associated with home ownership. But research by other entities found this to be a false premise.
Also, we must consider the timeframe of the research: It was done at the bottom of the worst recession since the Great Depression, when many Americans were hanging on by a thread to keep their homes and, of course, under the circumstances, the responsibilities of maintaining a home may have seemed more onerous, with less cash to do it.
In giving a more well-rounded assessment of the renter vs. homeowner debate, I would be more likely to rely upon Fannie Mae’s National Housing Survey from 2010, reporting that 75% of current renters believe that owning a home makes more sense, and 67% plan to buy a home at some point in the future. When current renters were asked for the major reason to buy a house, 78% said it was a good place to raise children; 75% said because they would feel safer; 70% said because you have control of your own space; 66% said owning a home would be a good way to build wealth; and 54% said paying rent is not a good investment.
If you were to believe that renters are happier, you would have to swallow that the majority of people enjoys living in a less safe environment, which wouldn’t be as good for raising children and where they have less control of their space in a place that won’t enable them to build wealth.
But, let’s face it, some of us are not in a position to own a home, and certainly renters can be as happy as homeowners, but at the same time, let’s not knock home ownership which, besides its obvious contributions to our happiness, drives our economy, as the recession so painfully demonstrated.
Maybe it can best be summed up without all that somewhat questionable research by the second most famous line in movie history (the first being, “Frankly, Scarlett, I don’t give a damn”) when Judy Garland as Dorothy Gale in The Wizard of Oz says, “Oh, Auntie Em, there’s no place like home.”
Bill Primavera is a Residential and Commercial Realtor® associated with Coldwell Banker, as well as a marketer and journalist who writes regularly as The Home Guru. For questions about home maintenance or to buy or sell a home, he can be emailed at Bill@TheHomeGuru.com or called directly at 914-522-2076.