Dive Brief:

• Homeownership rates have been on the decline since the mid-1990s, with sharper falls recorded for households headed by adults younger than 35 years old as well as blacks and individuals in lower income tiers, according to a recent Pew Research Center analysis of Census Bureau and mortgage loan data.

• A “substantial portion” of the drop-off in homeownership rates, according to Pew, comes from fewer renters becoming homeowners rather than homeowners leaving the market due to foreclosure or financial troubles. Still, seven in 10 renters said they would like to one day purchase a home.

• For households headed by individuals younger than 35, 41.2% were homeowners in 1982 compared to 37.3% in 1994 and 35.2% today. However, the homeownership rate for individuals at or older than 65 remains above 1994 levels (and the national average) at 79% today.

Dive Insight:

Millennials continue to face major head winds in the housing market amid rising home values, low inventory levels, higher rents and tighter post-recession credit levels.

A limited supply of housing has helped push U.S. home prices to an annual rate of 5.5% in September compared to 5.1% in August, the highest level since July 2006, according to recent figures from the S&P CoreLogic Case-Shiller U.S. National Home Price Index.

The knock-on effect of higher prices was underlined by a recent Trulia report showing that the fourth quarter of this year saw a 12.1% drop compared to a year earlier in the number of homes for sale targeting the nation’s typical first-time buyers, the largest fall in three years.

Although overall homeownership rates crumbled to a 51-year low in the second quarter of this year, there are signs that the market could be turning around. The rate rose to 63.5% in the third quarter, with more households owning than renting for the period.

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