Barbara Ballinger is a freelance writer and the author of several books on real estate, architecture, and remodeling, including The Kitchen Bible: Designing the Perfect Culinary Space (Images Publishing, 2014). Barbara’s most recent book is The Garden Bible: Designing Your Perfect Outdoor Space, co-authored with Michael Glassman (Images, 2015).
Jeff Hornstein: Pursuing the Dream
As NAR’s 100th anniversary draws near, a historian explores the development of the real estate profession and how home ownership became part of middle-class culture.
January 1, 2007
How did you become interested in REALTORS®, and what inspired the title of your book, A Nation of REALTORS®?
HORNSTEIN: The title comes from a 1929 article of the same name by a history professor. The article interested me because it showed how a particular occupation—real estate—could influence what we think about middle-class values. And it inspired me to write a book about the early days of organized real estate and how it affected home ownership. I discovered how the REALTOR® image changed as the profession established standards and practices.
The federal government promoted home ownership in the 1920s, but the 1930s were the watershed moment. What happened?
HORNSTEIN: As Commerce Secretary in the 1920s, Herbert Hoover believed that home ownership was the foundation of democracy. He worked with leaders in real estate to professionalize the field, standardize home-building practices, and persuade banks to provide mortgage funds. But this vision of a nation of home owners was constrained by the philosophy of limited government that held sway. The Depression brought about a profound shift in the nature of government. Under Franklin D. Roosevelt, also a true believer in the value of home ownership, the government worked closely with REALTORS® to produce the National Housing Act of 1934. The NHA set up a system of mortgage insurance and wrote into law many of the REALTORS®’ ideas about home building, planning, appraising, and financing.
In your book you say that by the 1940s most Americans identified themselves as middle class, even if they weren’t. How did that occur, and what was the impact on home ownership?
HORNSTEIN: During the Depression, when the Gallup Organization first asked Americans what social class they belonged to, many said “middle class.” When a second question asked if they had enough money to get by, many said “no.” People thought of themselves as middle class because of the values they associated with the term—such as hard work leading to success. Middle-income people began buying homes in large numbers because of the policy changes implemented in the mid-1930s. Before then, only the wealthy and the working class bought homes, and usually without a mortgage. The wealthy could afford to buy a home outright, while the working class scrimped to buy a modest workman’s cottage.
What’s happening today with the middle class, and how will it affect the real estate profession and home ownership?
HORNSTEIN: There’s a growing inequality between rich and poor and a squeeze on the middle class. I don’t think there’ll be another depression, but I see ominous trends, such as an increase in personal bankruptcy. Owning a house makes sense because it represents a place to live and invest. But people need to go back to mortgages they can afford rather than being highly leveraged. We’re already seeing a slowdown in the housing market, which affects the income and stability of the profession.
What do you think has been the most positive impact of the rise of the real estate profession on this country?
HORNSTEIN: Real estate brokerage is one of the first occupations where women stood on equal ground with men. Especially during World War II, women demonstrated that they could do the job as well as men. Rosie the Riveter was a five-year factor, but Rosie the REALTOR® came into the workforce, stayed, and helped transform the economy.
For more on Hornstein and his book, click here .
Updated: July 13, 2018