Homebuying: A critical perspective on financial costs and gains

Abstract

In Britain, the shift from the ideology of homeownership into one of homeownership-based welfare has been sustained by homebuyers being regarded as investors. Homeowners are expected to create a synergy between the owned house seen as a space of shelter, place of home and increasingly, an investment vehicle and an object of debt. Drawing on 80 interviews with owner-occupiers and national data on house prices and mortgages, we examine the way in which the meanings of home meanings are negotiated through the subjective calculation of the financial costs and gains of homebuying. We explore homebuyers’ debt amnesia, their miscalculation of gains and their disregard of inflation. However homebuyers’ financially unsophisticated understanding of the asset-home arises less from book-keeping complexities or difficulties in pricing the emotional domain of the home, but rather by them instinctively considering the alternative cost of a rented space of shelter. From this financial perspective and given affordability, homebuying illustrates a misleading ideological notion of choice.