Homeownership Rates Take a Surprising Turn

Although homeownership rates on the whole continued to decrease in the second quarter of 2019, they increased among younger homeowners: 36.4% of all homeowners are 35 and younger. With millions of younger buyers aging into the housing market over the next nine years, there’s an opportunity to appeal to them in your marketing. In contrast, homeowners 65 and older are still the biggest share (78%), but their numbers have been shrinking since 2012.

Incomes didn’t keep pace with the explosion of entry-level home values in 2017 and 2018, causing some buyers to retreat from the market for lack of a big enough down payment. In response, home sales and home value appreciation notably slowed. The recent rise in homeownership among younger buyers might be a sign of their determination to own a home, despite the challenges of saving for it.

New construction permits and homeownership rates still lag behind 1995 levels. The continued slowdown in homeownership rates over the first six months of 2019 — 64.2% in quarter one, 64.1% in quarter two — is a temporary break from the unsustainable home value appreciation in 2017 and 2018. The market is on its way back to normalcy, but calling it a full recovery would be premature.