Looking Back at the History of Housing in Honor of Independence Day

Looking Back at the History of Housing in Honor of Independence Day


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Independence DayAmericans have been celebrating the Fourth of July or Independence Day since 1941 when the U.S. Congress declared it as a federal holiday. However, the tradition of this celebration goes back as far as the American Revolution. The Continental Congress voted for independence on July 2, 1776 and two days after which was July 4th, the Thirteen Colonies accepted the Declaration of Independence. This is the same document many of you may have seen in the film National Treasure.

Thomas Jefferson drafted this historic document. Since then, Americans have been celebrating the birth of our independence every year. There are fireworks, parades, concerts, BBQ, and different kinds of festivities going on. History states that July 2 was the actual day the voting of independence took place but we all celebrate it on July 4th.

Before Independence Day

America was originally made up of thirteen colonies including Pennsylvania, Georgia, Maryland, Massachusetts, New Jersey, New York, New Hampshire, North Carolina, South Carolina, Virginia, Connecticut, Delaware, Rhode Island and Providence. The Thirteen Colonies mostly focused on agriculture and were operated by the British.

A conflict started to arise between the colonies and the British due to issues on taxes and laws which mostly favored the needs of the British. At the same time, a sense of nationalism grew among the settlers in the country. Hence, settlers began demanding for their representation in the British parliament.

To address the growing tension, the Continental Congress where the Thirteen Colonies gathered declared war against Britain to gain their independence. 56 representatives of the Thirteen Colonies signed the Declaration of Independence including future U.S. presidents Thomas Jefferson and Benjamin Franklin. In 1783, the war ended and America was free.

Home Ownership: A Brief History

For a very long period, only farmers had their own house and lot. However, due to the Industrial Revolution, home ownership became attainable even for city dwellers. Nonetheless, only less than half of Americans owned their houses up until the late 1940’s.

During the 1800’s, most Americans didn’t own a house because they could not afford the lump sum amount required. Meanwhile, the banks do not lend out money to average Americans for the purpose of buying a house. Mortgages only became available in the 1860’s.

At this point, banks started lending people money to purchase homes. In the 1890’s, mortgages became popular and common among Americans which is what we are familiar with today.

According to the U.S. Census Bureau, in 1890, the rate of home ownership is at 47.8%. As of January 2018, it went up to 64.2%. The highest rate was in 2010 at 66.5%.

Mortgages: Now and Then

During the early 1900’s, a mortgage offers a five-year payment term with a 50% deposit whereas, in the present day, most mortgages offer 30-year payment terms and a down payment of only 5% to 20%. Most mortgages in the 1900’s are structured with monthly interest payments. In effect, this adds up to a huge payment at the end of the term. However, borrowers are able to negotiate their deals every year.

This structure worked for the borrowers until the Great Depression struck. Due to the financial crisis, banks could no longer lend money because they didn’t have any to spare. Borrowers also didn’t have any money to buy a house.

Hence, potential buyers could not afford to buy a house and majority of the homeowners had to default. In the 1930’s, it was reported that almost 10% of homes became foreclosed.

The Housing Boom

housing boom

In order to maintain a stabilized housing market, the government established several housing institutions during the 1930’s. These addressed the housing crash and re-established the home ownership among Americans. In 1944, the G.I. Bill became a game changer in the housing industry. It subsidized mortgages for World War II veterans.

It increased the demand for housing which led to the development of real estate in the suburbs. Buying houses became more common for Americans. Real estate brokers came into play.

The housing market started to thrive during the 1940’s and 1950’s. At the same time, the real estate profession also started to boom. By the 1950’s, over half of Americans already owned their houses. However, as the demand for houses continues to increase, the market prices also went up.

State of Tennessee

The leaders of Tennessee converted the land into a new state including an organized government and constitution. The Southwest Territory became the first Federal territory presented to the Union’s admission. In 1796, Congress approved and Tennessee became part of the Union in 1976 and was declared as the 16th state of the U.S. Therefore, North Carolina’s northern and southern borders were extended to the Mississippi River and the western boundary of Tennessee.

At the early period of settlement, planters and African Americans from Virginia and Kentucky flocked to Tennessee. Most of the African Americans settled in Middle Tennessee. Plantations cultivated different types of crops, horses, and cattle.

In 1796, free African Americans were allowed to vote as long as they passed the property and residency requirements. By the year 1830, the population of African American settlers increased due to the development of plantations.

Tennessee’s Housing Market

According to a 2017 report from the Tennessee Housing Development Agency (THDA), the housing market in Tennessee continues to improve. In most states, there is an upward trend in terms of home pricing. Houses in Tennessee did not appreciate as significantly as other states such as Washington, Idaho, and Colorado.

In Nashville, the appreciation of house pricing exceeded the country’s price index. At 7.7%, Tennessee ranked 16th among the country’s states in terms of its annual price appreciation.

There are continuous efforts to help homeowners that are struggling to keep their homes. Some homeowners have challenges when it comes to paying their monthly mortgage due to several reasons such as job loss, unemployment or medical disability.

Several institutions support residents of Tennessee from median and low-income families, such as the THDA. They assist in creating more jobs, incomes, and revenue in the local economy.

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