The U.S. homeownership rate dropped to its lowest level since 1965, according to a new report from the Census Bureau.
Nearly 63 percent of U.S. households owned their home in the second quarter of the year – down from 63.5 percent in the previous quarter. The rate reached a peak of 69.2 percent in 2004 but tumbled in the wake of the 2008 financial crisis amid stagnating incomes and rising home prices.
“One of the biggest hurdles now is affordability,” Wells Fargo economist Mark Vitner told Bloomberg. The S&P Case-Shiller 20-city home price index grew 5.2 percent year-over-year in May.
The homeownership rate does not include people who neither rent nor own — for example, those who live with friends, relatives or roommates –making it a somewhat imperfect indicator of the overall housing picture.
If the decline is real, it is more likely due to a large increase in the number of renter households than any real decline in the number of homeowner households,” Trulia’s chief economist Ralph McLaughlin wrote.[Bloomberg] – Konrad Putzier