Owning a home has long been considered part of the “American Dream.” Unfortunately, accessing homeownership is challenging and becoming increasingly more difficult for Memphians.
As the cost of buying homes rises and the barriers to attaining, retaining, and transferring wealth are made inaccessible and difficult, fewer families can qualify to buy homes, and this disparity is impacting equitable generational wealth opportunities for future families. In a mission to advance opportunities and encourage equitable homeownership in our beloved city, Memphis Habitat connects affordable mortgages wrapped by financial education to first-time homebuyers so the American Dream can be a possibility for all families and their children.
As a researcher at Habitat for Humanity of Greater Memphis, my work is rooted in not only connecting with client families to learn the positive impacts of Habitat’s programs but also sharing those findings and why affordable homeownership is a right and valuable consideration for the success of our city. Our local data analyses have illustrated the exponential impacts homeownership has on homebuyers, their children, and the surrounding community.
Courtesy of Habitat for Humanity of Greater Memphis
Memphis Habitat Homebuyers, Amanda and Marandow, and their three boys Michael, Nehemiah, and Josiah
Consider these potential positive impacts with the children you love in mind. They might inspire you to reimagine how you think about access to homeownership.
Homeownership kickstarts generational wealth.
Affordable homeownership and the policies that support it have been linked to stimulating opportunities for wealth creation between generations. Habitat homebuyers typically spend less of their paychecks on their mortgages due to the zero-interest mortgage and substantial financial literacy education completed before they move in. Savings from interest and empowering homebuying education can have remarkable impacts that help families who were pushed far from the starting line of homebuying. Habitat homebuyers will ultimately pay less in their mortgages than local renters will (over half of Memphian renters are housing-cost burdened and spend 30% or more of their income on housing).
With Habitat homes, the affordable mortgages allow them to build equity at a faster rate when compared to other mortgage holders in comparable areas with similar loan amounts that have interest. Historically, precious, hard-fought financing opportunities can produce assets and safe havens passed down to children, changing the transmission of disadvantage from one generation to the next.
Habitat homebuyers save a little extra because all of the organization’s homes are built using MLGW’s EcoBUILD construction standards. More than 75% of Memphis Habitat homebuyers report saving on their utilities shortly after moving into their new homes. These savings have long-lasting impacts on wealth creation, which will one day be passed onto future generations. With Memphis being one of the most common cities with energy-cost burdens, families who are entering into affordable homeownership can see cost savings on their utilities that improve the ability to afford medication, transportation, food, and quality-of-life extracurricular activities in and around the community. Additionally, safe and properly equipped heating and air systems in Habitat homes offer an immediate benefit for new Habitat homebuyers who experienced problems with HVAC systems at their previous rentals. Issues with heating and air systems have been correlated to respiratory problems for families, furthering disparity for future generations.
Homeownership enhances academic performance.
Our research has shown that local Habitat homebuyers moved two to four times in the 10 years prior to purchasing their homes, and nearly 10% moved five or more times. Homeownership provides stability by giving children a place to come home every day, and that stability translates academically and behaviorally. Frequent, consistent moves due to renting can force students to switch schools often, which can negatively affect academic achievement; Adverse Childhood Experience (ACE) scores; extracurricular activities; and social bonds with their peers and educators. Children of Habitat homebuyers can remain rooted in one school community where consistent enrollment creates greater opportunities for intellectual and social growth. Additionally, parents who own homes are more consistently involved in the academic and social lives of their children. Seventy-eight percent of Memphis Habitat homebuyers who are parents report attending more PTA meetings and school activities than before they bought their homes.
While there are a variety of reasons a child might move schools, staying in the same neighborhood offers stability and consistency. Children can see their friends every day and forge deeper connections with peers. They also get to form connections with educators. This is a vital part of academic success. As teachers get to know their students better, they can tailor lessons to help best fit diverse learning styles and student needs. Even if schools get rezoned, the people they see daily will remain the same in their communities — the friends they have in the neighborhood are in the same boat.
Homeownership improves mental and physical health.
From mice and cockroach infestations to improperly functioning plumbing and electrical systems to poor insulation and roofing, many rental options threaten the health of those who live there. Purchasing and moving into a quality, affordable home instantly removes those threats. Homebuyers no longer have to deal with landlords who may or may not care about the living conditions in their properties nor allow renters to make improvements. As homebuyers, they have the autonomy to make needed changes to eliminate health hazards before they impact their family’s quality of life. For Habitat homebuyers specifically, they know their children are living in a home that meets — and exceeds — basic building and health standards.
Homeownership also provides peace of mind. Children no longer have to worry about where they’re going to sleep that night or when they will have to move again. They can go to school, focus on learning and being with their friends, and then return home to the same spot every single day. Having that sense of stability and consistency can work wonders on a child’s mental health. More than half of Memphis Habitat homebuyers have reported an improvement in the health of their children — 55% say their children appear less stressed, 80% of children seem happier, and 60% have made more friends who can come play with them at their home.
Homeownership builds parent-child relationships and community connections.
Homeownership paints a beautiful picture of community connection. Imagine your children walking home from school with their friends. Along the way, they wave at their neighbors sitting out on the front porch. Maybe they even stop to chat about their day. When a home feels permanent, children can make genuine connections with their neighbors, who in turn will look out for them and their safety.
Parents who own their homes can also be more involved in their children's lives. Memphis Habitat found that 92% of its homebuyers feel an improved sense of hope in their futures and their children's futures. While all caregivers worry about the children in their lives, owning a quality, affordable home means they no longer worry about unhealthy housing conditions or the possibility of experiencing homelessness. Homeownership helps take some of the burden off of caregivers.
Homeownership is not the be-all and end-all for improving the lives of children, and rental opportunities do not always have terrible attributes, but having access to affordable homeownership has influential positive impacts — providing stability, building community connections, and improving mental and physical health. Affordable Habitat homeownership has demonstrated that housing no longer feels unpredictable for families and has many opportunities to support childhood outcomes. By providing more families with opportunities to purchase affordable, high-quality homes, Memphis Habitat is making permanent, long-lasting improvements to current and future generations of Shelby and Fayette County residents and communities.
Since its inception, Memphis Habitat has helped more than 500 first-time homebuyers secure affordable mortgages and completed rehabilitation and home modification projects in partnership with nearly 1000 local homeowners, helping them achieve the independence they need to build a better life for themselves and their families.
Habitat’s vision is a world where everyone has a decent place to live. To learn more, visit memphishabitat.com.
Chris Reeder Young, M.A. is director of Research and Policy at Habitat for Humanity of Greater Memphis.