Paeans to homeownership are commonplace for American politicians, Democrats and Republicans alike. Ever since the nineteen-thirties, public policy has been designed to make home buying cheaper and easier. Pundits argue that homeownership has tremendous social benefits, stabilizing neighborhoods and making people more willing to invest in their communities. Furthermore, those promoting homeownership state that it has economic benefits, too, serving as a forced-savings program that allows people to leverage their incomes and build wealth.

Buying a home used to require a sizable down payment: in 1976, the average for a first-time buyer was eighteen per cent. By contrast, a National Association of Realtors study of first-time buyers between mid-2005 and mid-2006 found that almost half put down nothing at all, and that the median down payment was just two per cent.

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