Jeffrey Sparshott reported on Friday at The Wall Street Journal Online that, “The U.S. homeownership rate fell to the lowest level in more than 50 years in the second quarter of 2016, a reflection of the lingering effects of the housing bust, financial hurdles to buying and shifting demographics across the country.
“But the bigger picture also suggests more Americans are gaining the confidence to strike out on their own, albeit as renters rather than buyers.
“The homeownership rate, the proportion of households that own their home, fell to 62.9%, half a percentage point lower than 2015’s second quarter and 0.6 percentage point lower than the first quarter of 2016, the Census Bureau said Thursday. That was the lowest figure since 1965.”
The Journal article noted that, “There are many ways to interpret the numbers. Part of the story is the catastrophic housing market collapse, which was especially severe for Generation X—those born from 1965 to 1984.
“Younger households, meantime, struggle to save amid student debt, growing rents and sluggish wages, and face a limited supply of starter homes. Indeed, the homeownership rate for 18-to-35-year-olds slipped to 34.1% in the quarter, the lowest level in records dating to 1994.
“At 77.9%, the homeownership rate was highest for those 65 years and over.”
Mr. Sparshott added that, “Down the road, many renters will likely look to become buyers, spurring a housing market that already appears constrained by rising prices and limited home inventories.”
