Wall Street Journal writer Laura Kusisto reported recently that, “The U.S. homeownership rate fell for the first time in more than two years in the first quarter, putting the brakes on the recovery of an important piece of the economy.
“The homeownership rate fell to 64.2% in the first quarter from 64.8% in the fourth quarter, according to U.S. Census Bureau figures released [April 25th]—a notable drop for a number that barely moves from one quarter to the next. After more than a decade of declines, the homeownership rate had been reliably on the upswing since the beginning of 2017 and was nearing its historic average of around 65%.
“First-time buyers ‘are hitting a bit of an affordability ceiling here,’ said Zillow Director of Economic Research Skylar Olsen.”
The Journal article stated that, “A rising homeownership rate primarily reflects younger households successfully making the transition from renting to owning, which for many families is critical to saving for retirement and other big expenses. Those households have struggled in recent months as mortgage rates have risen and there has been a shortage of lower-priced inventory.”
Ms. Kusisto added that, “Younger buyers, who had been driving the rise in homeownership for the last couple of years, had some of the steepest falls in the first quarter. The homeownership rate of households headed by someone under 35 years old dropped to 35.4% from 36.5% in the fourth quarter. The homeownership rate among households headed by someone 35 to 44 dropped to 60.3% from 61.1%.”
