When you own a house you have an investment that produces a non-cash benefit. In principle, if you're in a half-million dollar clear title house, you could sell the house, invest the proceeds, and pay rent with the resulting income. However, the odds are good that if you rented housing equivalent to the housing your were selling, you would end up worse off in cash terms; that is, the market value of the non-cash benefit you get from owning a house is more than the return you could get from investing the same money in some other similarly safe investment. That non-cash benefit is not taxed, whereas the cash return on alternate investments would be.

Shelter is a VERY real benefit.