Dive Brief:
- The second-quarter U.S. homeownership rate slipped from 63.5% in the first quarter to 62.9% — its lowest level since 1965, according to the Census Bureau.
- Experts have blamed millennials for a significant portion of the persistently low rate, as student loan debt and delays in starting families have pushed the 18-34 age group's homeownership level to a historic low of 34.1%, according to Bloomberg.
- All U.S. regions saw a declining homeownership rate in the second quarter. The nation's homeownership rate reached an all-time high in June 2004, at 69.2%.
Dive Insight:
The weak homeownership rate can also be attributed to the strong rental market, as millennials and other generations rocked by the housing crash have stuck with renting. The lack of affordable homes available has kept potential buyers away, as inventory concerns have hindered stronger growth in the housing market. A June report from the Urban Institute found that, despite increased construction, there are only six new homes built for every 10 new U.S. households.
Real estate organizations have urged homebuilders nationwide to increase new home construction, but builders have maintained that increasing regulatory costs, which the National Association of Home Builders reported can add nearly 25% to a home's price, are keeping them from ramping up construction.
Despite the drop in the homeownership rate, an NAHB survey released this week found that 82% of Americans believe buying a home is a good investment. However, the survey also found that 55% of respondents said they had trouble finding an affordable home, 50% didn't have enough saved for a down payment, and 41% couldn't get approved for a mortgage.
