The No. 1 consumer product in America isn't a soft drink, a car or even a refrigerator. It's a home, says the leader of the nation's largest supplier of mortgage funds.

Speaking to National Association of Home Builders' annual convention here over the weekend, Franklin Raines, chairman of Fannie Mae, noted that nobody has to be convinced to buy a home.

"Everybody wants one, and they're willing to stretch to get it," he said. "And their love affair doesn't end with obtaining a mortgage; it's just the beginning. Making a house a home is a true American pastime."

About 80,000 builders and allied professionals from throughout the country attended thehuge exposition, which featured enough building products to fill eight football fields from one end zone to the other.

Raines told the NAHB's board of directors that American families spend 25 percent of the their incomes on buying, furnishing, fixing and maintaining their homes, accounting for about 14% of the nation's gross domestic output in the process.

"About one of every $7 spent each year" goes for housing in one way or another, he said.

In total, home owners spent $1.7 trillion last year on housing related goods and services -- more than they spent on food, clothing and education combined, according to the Fannie Mae official.

Raines also called housing the top consumer investment in America and the country's No.1 economic driver.

"More people have more of their wealth invested in their homes than in the stock market, the money market or their retirement savings plans," he told the board, noting that 39 percent of the people polled in a recent study said they believed real estate is the best investment they can make while only 25 percent picked the stock market.

And they are right, according to Fannie Mae's calculations. People who invested $10,000 in house in 1997 instead of stocks would have beaten a basket of NASDAQ stocks by more than 50 percent and the S&P 500 by more than 100 percent, the company says.

"After the longest, strongest bull market in history," Mr. Raines said, "the average home owner in America earned twice as much equity wealth as the average stockholder earned in the market -- $44,000 vs. $23,000."

As an economic driver, housing has been second to no industry, especially during the recent recession, he also pointed out. While most industries were hit fairly hard, housing has actually prospered, with starts up 4 percent and sales up almost 6 percent.

"If housing had slipped as it usually does during a recession, the decline in the gross domestic product would have been five times worse, and 350,000 more people would have lost their jobs," the Fannie Mae chairman said.

"Without the boost from housing, it's clear that the recession would have started sooner, lasted longer, and been more severe."

It's for these reasons that Fannie Mae expects consumer investment in housing to more than double over the decade, from $11 trillion to perhaps as much as $25 trillion by 2010.

"It took the entire history of the country to get to $11 trillion, and we'll double that amount in less than 10 years," he said.

Published: February 13, 2002

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When Lew Sichelman first started writing about housing in 1969, he was the youngest real estate writer in the country. Now, 37 years later, he's one of the oldest -- and most decorated. He has been rated the top housing columnist in the country by the National Association of Realtors as well as by his peers in the National Association of Real Estate Editors. Indeed, NAREE has recognized his work on numerous occasions. One year - due to his advancing age, he can't recall which one - he earned top honors in the annual NAREE Journalism Contest in three out of the four major writing categories. It was the first time one writer has won so many NAREE awards in a single year. Known for his ability to make even the most difficult topics understandable, Sichelman also has been honored by the National Association of Home Builders and the Mortgage Bankers Association. He began providing in-depth coverage of and consumer-oriented information about housing and housing finance at the Washington Daily News, where he was real estate editor. He held that same position for nine more years at the Washington Star, which purchased the News in 1972. The Star, a so-called "writer's newspaper" which also had the misfortune of being an evening paper, was put out of its misery in 1981, and Sichelman, who had begun self-syndicating his column in 1978, decided to become a full-time columnist. Today, his column, "The Housing Scene," is distributed by United Media to newspapers throughout the country. He also is on the staff of National Mortgage News, an independent newspaper which is considered the bible of the mortgage business. And he writes for numerous other publications, including MarketWatch.com, where he answers readers questions once a week, Sports Illustrated (don't ask), RealtyTimes.com, BigBuilder and others. Sichelman is married, the father of five and grandfather of eleven.