There’s a reason why the residential property market continues to attract tens of thousands of first-time home buyers every year - and it has little to do with economic cycles, interest rates, or tiresome landlords.
Rawson says the type of benefits that most first-time buyers aspire to have been well researched and documented over many years, and include better education opportunities and outcomes, higher levels of self-esteem and happiness, and stronger, more stable communities. It’s much more about the social and psychological benefits of owning your living space, says Bill Rawson, chairman of the Rawson Property Group.
“There just comes a stage in most people’s lives when they want to enjoy those benefits and will do whatever they need to do to become homeowners.”
Rawson says the timing is different for everyone, as evidenced by the varying ages at which people buy their first homes, but whether it is sparked by moving out of your parents’ house, getting married, wanting to start a family or just a wish to settle down after a few years of changing jobs and rented spaces, homeownership remains a major life goal for most people.
He says this sort of “social imperative” is even stronger in developing countries like South Africa, where the middle class has grown exponentially in the past 20 years and millions of people are now able to have many things that they were previously either too poor to afford or, in the case of property, excluded from buying by law.
“Certainly, our experience among such buyers is that homeownership is increasingly seen not only as a cornerstone of wealth creation, but as a key component of a better life overall for the owners and their families.”
Rawson says the type of benefits that most first-time buyers aspire to have been well researched and documented over many years, and include better education opportunities and outcomes, higher levels of self-esteem and happiness, and stronger, more stable communities.
“Several studies done by the US National Association of Realtors (NAR), for example, have found that because homeowners move far less frequently than renters, they become embedded in their neighbourhoods and communities, and are much more likely to participate in joint activities to protect and improve those communities,” says Rawson.
“Activities that come to mind include neighbourhood watch or other communal anti-crime measures, local clean-up initiatives or fundraising in support of local schools and old-age homes.”
Then of course, he says those who own their homes are also inclined to spend more time and money maintaining and improving their properties than those who are renting, and this also makes for suburbs with a better overall appearance and a sense of pride among the residents.
By contrast, Rawson says renters who are not invested in their current communities are much less motivated to try to deter crime and grime by forming and implementing voluntary prevention or improvement programmes, or to worry about protecting property values in the area.
“Indeed, if crime levels start to rise in an area or it starts to decay, their most likely response will be to just move elsewhere.”
Meanwhile, he says several other studies have also made it clear that homeownership has a significant impact on educational achievement.
“For instance, the decision by teenage students to stay in school and complete their secondary education is always higher among those whose parents or guardians are homeowners than among those whose parents are renters,” says Rawson.
“The take-up of further educational and economic opportunities is also more prevalent in suburbs with high rates of home ownership. On the other hand, studies have shown that changing schools frequently due to moving more often actively damages children’s educational prospects.”
Research has also shown that homeowners have better physical health profiles and self-report lower levels of stress and higher levels of happiness than people who rent. Homeowners and their families also have more self-confidence and more belief in their ability to achieve their other goals in life.
“And finally, political parties who would like people to vote in the upcoming municipal elections should note that homeowners have been proven to show higher levels of political interest and civic participation as well as higher membership in voluntary organisations,” he says.
