{"id":2659,"date":"2017-03-28T00:00:00","date_gmt":"2017-03-28T00:00:00","guid":{"rendered":"https:\/\/amazingproperty.com.ng\/blog\/the-economys-thorn-low-ownership-rates\/"},"modified":"2017-03-28T00:00:00","modified_gmt":"2017-03-28T00:00:00","slug":"the-economys-thorn-low-ownership-rates","status":"publish","type":"post","link":"https:\/\/amazingproperty.com.ng\/blog\/the-economys-thorn-low-ownership-rates\/","title":{"rendered":"The Economy's Thorn: Low Ownership Rates"},"content":{"rendered":"

\n<\/p>\n

<\/p>\n

The homeownership rate is near its lowest level in more than 50 years. But homeownership remains a \u201ccritical part\u201d of the national economy and \u201congoing weakness in the single-family housing<\/a> market, represents a substantial hurdle limiting the pace of economic growth,\u201d according to a newly released study by the Rosen Consulting Group and Fisher Center for Real Estate<\/a> and Urban Economics funded by the National Association of REALTORS\u00ae.<\/p>\n

\n

Read the Report<\/strong><\/p>\n

Homeownership in Crisis: Where Are We Now?<\/p>\n<\/blockquote>\n

Homeownership not only helps individuals build personal wealth but is also vital for strengthening communities, according to the report, \u201cHomeownership in Crisis: Where Are We Now?\u201d\u00a0<\/p>\n

Yet, ownership in the U.S. has dropped significantly over the past decade. Through the 1990s and early 2000s, the national homeownership rate jumped to 69.2 percent, adding about 11.3 million new owner households nationwide from 1994 through 2004. That trend shifted, however, as the ownership rate plummeted over the past decade due to the foreclosure<\/a> crisis and Great Recession.<\/p>\n

In 2016, the homeownership rate reached an annual average of 63.4 percent, a 5.8 percentage point decline compared to the pre-Recession peak. All regions of the country have been \u201cseverely affected\u201d by the declines in the homeownership rates, the report notes. The West and Southern regions have faced the largest declines in ownership rates.<\/p>\n

What Prompted the Plunge?<\/strong><\/p>\n

The study points to numerous culprits that contribute to the decline in ownership rates, including the more than 9.4 million homes that were lost to foreclosure, short sales, and deed-in-lieu transactions from 2007 through 2015. Also, tight mortgage<\/a> credit, a change in demographics, and growth in \u201cdoubling up\u201d with adult children moving back in with parents, as well as several economic factors from the Great Recession, all prompted the shift in ownership rates.<\/p>\n

Job losses became a major factor behind the foreclosures<\/a> as real median household incomes plummeted. The median household income did rise in 2015, by 5.2 percent to nearly $56,500, adjusted for inflation. But the current median household income remains below the pre-Recession high of more than $57,400 in 2007, according to Census data. Further, the real incomes among 25- to 34-year-olds dropped by 18 percent between 2000 and 2014, and there was a 9 percent decline in real incomes among 35- to 44-year-olds during that period. As such, homeownership rates dropped by 4.9 percentage points for households under age 35 and by 8.2 percentage points for households aged 35 to 44.<\/p>\n

Optimism Brews<\/strong><\/p>\n

Despite the national homeownership rate declining to historical lows, researchers remain optimistic that rates will stabilize and possibly even improve in the near to medium term.<\/p>\n

\u201cVarious economic and demographic factors will continue to both push up and pull down the national homeownership rate,\u201d the authors notes. \u201cAfter a sustained period of economic expansion, increased job opportunities and moderate but accelerating income growth are translating into improvements in household balance sheets. This increased financial security should directly increase the number of households entering the for-sale market.\u201d<\/p>\n

Further, improved finances should help more households feel comfortable in branching out to start or expand families, which will help to boost birth rates and spur demand for larger housing units too. The decrease in foreclosure activity, along with improving economic conditions, will particularly help first-time buyers as well as \u201cthe entire for-sale housing market to steadily return to more normalized conditions,\u201d the report notes.<\/p>\n

\u201cA gradual improvement in mortgage availability is likely to increase access to credit for minority households and help first-time buyers transition from renting to owning,\u201d the report also notes. \u201cWe expect these new buyers to play a major role in stemming the tide of recent homeownership rate declines.\u201d<\/p>\n

By Melissa Dittmann Tracey, REALTOR\u00ae Magazine Daily News<\/em><\/p>\n<\/div>\n

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The homeownership rate is near its lowest level in more than 50 years. But homeownership remains … The Economy's Thorn: Low Ownership Rates<\/span>Read more<\/a><\/p>\n","protected":false},"author":1,"featured_media":2660,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"advanced_seo_description":"","jetpack_seo_html_title":"","jetpack_seo_noindex":false,"jetpack_seo_schema_type":"","_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"jetpack_post_was_ever_published":false},"categories":[4],"tags":[1403,1418,1285,12908,543,3051,627,127,617,344,408,2886,1007,41,818,645],"class_list":["post-2659","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-opportunities-in-new-markets","tag-buy","tag-fish","tag-foreclosures","tag-home","tag-home-buying-guide","tag-homeowner","tag-homeowners","tag-homes","tag-house","tag-housing","tag-mortgage","tag-optimistic","tag-owners","tag-property","tag-real","tag-renting"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/03\/hVVk7GaevVg","jetpack_sharing_enabled":true,"jetpack-related-posts":[{"id":3958,"url":"https:\/\/amazingproperty.com.ng\/blog\/is-the-homeownership-rate-finally-stabilizing\/","url_meta":{"origin":2659,"position":0},"title":"Is the Homeownership Rate Finally Stabilizing?","author":"Amazing Property","date":"April 28, 2017","format":false,"excerpt":"Is This the New Normal for Homeownership? The U.S. homeownership rate was 63.6 percent in the first quarter of 2017, barely budging from last quarter\u2019s reading of 63.7 percent, the U.S. Census Bureau reports. Read more: Is This the New Normal for Houseownership? After reaching a cycle low of 62.9\u2026","rel":"","context":"In "Opportunities In New Markets"","block_context":{"text":"Opportunities In New Markets","link":"https:\/\/amazingproperty.com.ng\/blog\/category\/opportunities-in-new-markets\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":2710,"url":"https:\/\/amazingproperty.com.ng\/blog\/hispanics-are-a-growing-buying-force\/","url_meta":{"origin":2659,"position":1},"title":"Hispanics Are a Growing Buying Force","author":"Amazing Property","date":"March 29, 2017","format":false,"excerpt":"While the national homeownership rate decreases, ownership rates among Hispanics are defying the trend with steady rises. The Hispanic homeownership rate grew to 46 percent last year, topping previous highs of 45.6 percent in 2015 and 45.4 percent in 2014, according to the National Association of Hispanic Real Estate Professionals\u2019\u00a02016\u2026","rel":"","context":"In "Opportunities In New Markets"","block_context":{"text":"Opportunities In New Markets","link":"https:\/\/amazingproperty.com.ng\/blog\/category\/opportunities-in-new-markets\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":1268,"url":"https:\/\/amazingproperty.com.ng\/blog\/what-happened-to-black-homeownership\/","url_meta":{"origin":2659,"position":2},"title":"What Happened to Black Homeownership?","author":"Amazing Property","date":"February 24, 2017","format":false,"excerpt":"The Changing Face of Homeownership. Black homeownership has fallen to levels not seen since the 1960s. Black homeownership has fallen to levels not seen since the 1960s, shows a new analysis by The Urban Institute. 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