American Dream

Homeownership has long been a symbol for the American Dream. Americans saw it as a way to improve their status and to build wealth, and government policy encouraged it with generous tax incentives and with state and federally backed home-financing programs for poor and moderate-income families. And homeownership rates went from 43.6% in 1940 to over 60% by the early 1960s. It continued to rise throughout the housing boom, fueling loose mortgage standards and easy credit. After the crash, homeownership rates began falling again. Tighter lending standards will probably hold back gains for some time.