Owner-occupancy
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Owner-occupancy or home-ownership is a form of
Acquisition
Some homes are constructed by the owners with the intent to occupy. Many are inherited. A large number are purchased, as new homes from a real estate developer or as an existing home from a previous landlord or owner-occupier.
A house is usually the most expensive single purchase an individual or family makes, and often costs several times the annual household income. Given the high cost, most individuals do not have enough
Many countries offer aid to prospective homebuyers to make their purchases. These measures include grants, subsidized mortgages, and mortgage guarantees. Prospective homebuyers may have to meet certain qualifications to qualify for government aid, such as being a first-time homebuyer or having an income below a certain threshold.[2]
Pros and cons
Home ownership gives occupants the right to modify the building and land as they please (subject to government, homeowner association, and deed restrictions), protects them from eviction, and creates a right to occupation which can be inherited. In some jurisdictions, it also confers certain legal rights with regard to abutters.
Houses and the land they sit on are expensive, and the combination of monthly
Due to the fact that homeowners have a financial stake in their homes, being a homeowner is an economically efficient course of action. In order to improve their physical and mental well-being as well as their level of life satisfaction, they have a motivation to preserve or raise the value of their properties. Conversely, renters are incentivized to view local issues through a narrow lens, could be unmotivated to participate in civic life, and could see themselves as having little social utility.[3] Compared to renters and absentee landlords, owner-occupiers are sometimes seen as more responsible toward property maintenance and community concerns, since they are more directly affected.[4]
Traditionally, home ownership has been encouraged by governments in Western countries (especially
Political influence
Owning a home influences how an individual views the role of government. Data from OECD countries shows that when housing prices rise, individuals are more critical of the welfare state. Conversely, when housing prices drop, homeowners are more likely to favor government intervention. In the US, areas with high rates of homeownership have higher levels of voter turnout. There is also a weak relationship between homeownership and supporting Republican candidates. Data from the UK supports the idea that homeowners view the value of their home as a kind of private, informal insurance policy against economic shocks. A sufficiently valuable home protects the owner without need for government intervention.[6]
International statistics
Country | % Owner-Occupied Units in Urban Areas | Urban Population, % of Total |
---|---|---|
Argentina | 67% | 92% |
Armenia | 96% | 64% |
Australia | 68% | 89% |
Azerbaijan | 71% | 52% |
Brazil | 74% | 87% |
Bulgaria | 87% | 73% |
Canada | 68% | 81% |
Chile | 69% | 89% |
China | 89% | 45% |
Colombia | 50% | 75% |
Costa Rica | 75% | 94% |
Czech Republic | 47% | 74% |
Denmark | 54% | 87% |
Egypt | 37% | 43% |
France | 47% | 78% |
Germany | 43% | 74% |
Haiti | 60% | 48% |
Hong Kong | 53% | 100% |
Hungary | 93% | 68% |
India | 87% | 30% |
Indonesia | 67% | 54% |
Italy | 80% | 68% |
Kazakhstan | 96% | - |
Kenya | - | 22% |
Republic of Korea | 56% | 82% |
Malawi | - | 19% |
Malaysia | - | 72% |
Mexico | 71% | 78% |
Mongolia | - | 58% |
Morocco | 62% | 57% |
Namibia | 69% | 35% |
Netherlands | 59% | 83% |
New Zealand | 67% | 87% |
Nigeria | 10% | 50% |
Norway | 77% | 78% |
Pakistan | - | 38% |
Panama | 66% | 75% |
Peru | - | 72% |
Philippines | 80% | 66% |
Poland | 78% | 61% |
Romania | 97% | 54% |
Russia | 81% | 73% |
Rwanda | - | 19% |
Senegal | - | 43% |
Singapore | 87% | 100% |
South Africa | 62% | 62% |
Spain | 85% | 77% |
Sri Lanka | 82% | 15% |
Sweden | 41% | 85% |
Switzerland | 40% | 74% |
Tanzania | - | 26% |
Thailand | 75% | 34% |
Tunisia | 78% | 67% |
Turkey | 81% | 70% |
Uganda | - | 13% |
Ukraine | - | 68% |
United Kingdom | 50% | 90% |
United States | 65% | 82% |
Uruguay | 59% | 93% |
Venezuela | 83% | 94% |
Vietnam | - | 28% |
Zimbabwe | - | 38% |
Source: Housing Finance Information Network (HOFINET)[7]
Costs of home ownership
Property tax
Homeowners are usually required to pay property tax (or millage tax) periodically. The tax is levied by the governing authority of the jurisdiction in which the property is located; it may be paid to a national government, a federated state, a county or geographical region, or a municipality. Multiple jurisdictions may tax the same property.
Property Transfer Tax
In most
See also
- Home ownership in Australia
- Homeownership in the United States
- Imputed rent
- Negative equity
- Ownership
- Property
- List of countries by home ownership rate
References
- ^ Koren, Liran (2022-04-13). "Owner-Occupied vs. Non-Owner-Occupied Real Estate: What's the Difference?". Luxury Property Care. Retrieved 2023-07-28.
- ^ "Public spending on financial support to homebuyers" (PDF). OECD. 16 December 2019. Retrieved 21 September 2020.
- ^ (2015) Generation X and Y’s demand for homeownership in Hong Kong, Pacific Rim Property Research Journal, 21:1, 15-36, DOI:10.1080/14445921.2015.1026195
- ^ The Advantages of Renting
- ^ "Shelter, or burden?". The Economist. 2009-04-16.
- .
- ^ Housing Finance Information Network (HOFINET)
Further reading
- Kwak, Nancy H. A World of Homeowners: American Power and the Politics of Housing Aid ( University of Chicago Press, 2015). 328 pp.
External links
- Home Ownership Rate by U.S. State – Aggregation of Federal Reserve economic data