Has The Rate of Home Ownership Dropped to an All-Time Low?

Dennis Norman St LouisAs 2010 quickly comes to an end I sat here early this morning pondering the real estate market and reading reports on the housing industry. One thing that caught my attention was an article titled “The Mortgage Interest Deduction and Negative Equity” by Ted Gayer, the co-director of economic studies at the Brookings Institute (and occasional contributor to this blog). Ted’s article made some interesting points related to the mortgage interest deduction, negative equity and home-ownership rates in the U.S.

In his article Ted states “It seems semantically incorrect to call someone who owes more on an asset than it’s worth an “owner.”” This is a point that others have made as well and I think makes a good point. With this in mind, and in the mood to do some research and create some charts, I decided to dig into the topic deeper.

Rate of Home-Ownership in US has been falling since it’s peak in 2004…

As the chart below shows, the rate of home-ownership in the U.S. peaked in 2004 at 69.2 percent and has been falling ever-since to the most recent level of 66.9 percent at the end of the third quarter of 2010.

Source: Current Population Survey/Housing Vacancy Survey, Bureau of the Census

Do “Underwater” Homeowners Count?

I don’t have the stats for underwater homeowners in 2004, in fact I’m not even sure if the term existed back then, but I think it is probably a safe assumption to say that, during that time of rapidly rising home prices, few people were underwater. Flash forward to today, when, as reported by Corelogic, 22.5 percent of homeowners with a mortgage are underwater, meaning they owe more on their home than it is worth. Is Ted correct, should these people not be counted as homeowners? To Ted’s point I agree underwater owners don’t really own an asset, they own a liability, but they still “own” it nonetheless, at least for now. So to say that all 10.8 million of these homeowners should not be counted in the home-ownership rate is rather extreme. Having said that, if we do take them out of the count as homeowners, as the chart shows below, the rate gets pretty ugly and in fact hits an all-time low at 57.3 percent by my calculations.

Source: Current Population Survey/Housing Vacancy Survey, Bureau of the Census

A more fair approach would be to, instead of wiping out all underwater borrowers, only exclude those homeowners that are “severely” underwater, meaning they are underwater by 25 percent or more, which amounts to almost 10 percent of the homeowners with a mortgage. The chart for this is a little friendlier looking but with a rate of 62.3 percent is still a record low.

Source: Current Population Survey/Housing Vacancy Survey, Bureau of the Census

One-in-Four Homeowners Don’t Have a Mortgage

While I was pouring through census data and mortgage data focusing on negative equity I decided to take a shot at figuring out what percentage of homeowners have ZERO chance of being in a negative equity position….I’m referring to those homeowners without a mortgage of course. Interesting enough, there is about an equal number of people that own their homes free and clear (25 percent) as there are homeowners with negative equity or near-negative equity.

Where we headed?

It’s easy to see where we’ve been but it’s much harder to say where we are headed with regard to home-ownership rates in the U.S. Home prices are not rising but foreclosure rates are, so my guess is we will continue to see the home-ownership rate fall in 2011 as more and more homeowners are forced into renting. Once we get through this ugly cycle though, although, depending on the economy it could be another year or two, we will see people move back into home-ownership and the rate stop it’s downward trend. I’d say it’s going to be quite a while before we see those 2004 levels again though.

Print Friendly, PDF & Email

75 comments to Has The Rate of Home Ownership Dropped to an All-Time Low?

  • It’s onerous to seek out knowledgeable people on this topic, but you sound like you recognize what you’re speaking about! Thanks

  • You actually make it seem so easy with your presentation but I find this topic to be really something which I think I would never understand. It seems too complex and very broad for me. I’m looking forward for your next post, I’ll try to get the hang of it!

  • I’m really loving the theme/design of your blog. Do you ever run into any internet browser compatibility problems? A few of my blog readers have complained about my website not working correctly in Explorer but looks great in Chrome. Do you have any suggestions to help fix this problem?

  • Glad to be one of several visitors on this awing web site : D.

  • There is noticeably a bundle to know about this. I assume you made certain nice points in features also.

  • Hey very nice site!! Man .. Excellent .. Amazing .. I’ll bookmark your website and take the feeds also…I’m happy to find so many useful information here in the post, we need develop more strategies in this regard, thanks for sharing. . . . . .

  • Thanks for sharing superb informations. Your website is so cool. I am impressed by the details that you?¦ve on this site. It reveals how nicely you understand this subject. Bookmarked this website page, will come back for extra articles. You, my friend, ROCK! I found just the information I already searched everywhere and just couldn’t come across. What an ideal website.

  • I truly wanted to type a small note to say thanks to you for those great secrets you are posting at this website. My time consuming internet research has at the end of the day been rewarded with reasonable points to go over with my visitors. I ‘d believe that many of us readers are rather fortunate to live in a superb site with many outstanding individuals with insightful plans. I feel somewhat grateful to have discovered the website page and look forward to tons of more enjoyable times reading here. Thank you again for everything.

  • I like what you guys are up too. Such intelligent work and reporting! Carry on the excellent works guys I’ve incorporated you guys to my blogroll. I think it’ll improve the value of my web site :)

  • Very interesting subject , thankyou for posting.

  • Regards for helping out, wonderful information. “Considering how dangerous everything is, nothing is really very frightening.” by Gertrude Stein.

  • I have been reading out a few of your posts and i can state pretty clever stuff. I will definitely bookmark your website.

  • naturally like your web site but you have to check the spelling on several of your posts. Several of them are rife with spelling issues and I find it very bothersome to tell the truth nevertheless I’ll surely come back again.

  • I?¦m not positive where you’re getting your info, but good topic. I needs to spend some time learning much more or understanding more. Thanks for excellent information I used to be in search of this information for my mission.

  • It’s a pity you don’t have a donate button! I’d certainly donate to this fantastic blog! I suppose for now i’ll settle for bookmarking and adding your RSS feed to my Google account. I look forward to new updates and will share this website with my Facebook group. Chat soon!

  • Excellent post. I was checking continuously this blog and I am impressed! Very helpful info specially the final section :) I handle such info much. I was looking for this certain info for a long time. Thank you and best of luck.

  • Wohh just what I was looking for, regards for putting up.

  • Some genuinely interesting info , well written and broadly user pleasant.

  • Hey there just wanted to give you a quick heads up. The words in your content seem to be running off the screen in Ie. I’m not sure if this is a formatting issue or something to do with web browser compatibility but I figured I’d post to let you know. The design and style look great though! Hope you get the issue solved soon. Thanks

  • I’ll immediately grab your rss as I can not find your email subscription link or e-newsletter service. Do you have any? Kindly let me know so that I could subscribe. Thanks.

  • There is noticeably a bundle to know about this. I assume you made certain nice points in features also.

  • Good website! I truly love how it is easy on my eyes and the data are well written. I’m wondering how I might be notified whenever a new post has been made. I’ve subscribed to your feed which must do the trick! Have a nice day!

  • Undeniably believe that which you stated. Your favourite reason appeared to be at the internet the easiest factor to have in mind of. I say to you, I certainly get irked at the same time as folks consider worries that they plainly do not recognise about. You managed to hit the nail upon the top as well as outlined out the entire thing without having side-effects , people can take a signal. Will probably be back to get more. Thank you

  • I truly enjoy reading on this website , it has got excellent content.

  • hello there and thanks to your information – I’ve definitely picked up something new from proper here. I did then again experience several technical issues the use of this site, as I experienced to reload the website lots of times prior to I may get it to load correctly. I have been thinking about in case your web host is OK? Not that I am complaining, but slow loading cases times will sometimes have an effect on your placement in google and can damage your quality rating if advertising and ***********|advertising|advertising|advertising and *********** with Adwords. Anyway I am including this RSS to my email and can glance out for much more of your respective exciting content. Ensure that you update this once more soon..

  • I like this blog very much so much superb information.

  • I’m not sure exactly why but this site is loading extremely slow for me. Is anyone else having this issue or is it a issue on my end? I’ll check back later and see if the problem still exists.

  • Does your blog have a contact page? I’m having a tough time locating it but, I’d like to send you an email. I’ve got some recommendations for your blog you might be interested in hearing. Either way, great site and I look forward to seeing it grow over time.

  • I truly enjoy studying on this internet site, it contains superb content.

  • I will right away seize your rss feed as I can not find your email subscription hyperlink or newsletter service. Do you have any? Please permit me recognise in order that I could subscribe. Thanks.

  • Some times its a pain in the ass to read what blog owners wrote but this site is really user friendly! .

  • Have you ever thought about creating an ebook or guest authoring on other websites? I have a blog centered on the same information you discuss and would really like to have you share some stories/information. I know my readers would enjoy your work. If you are even remotely interested, feel free to shoot me an email.

  • The other day, while I was at work, my sister stole my iPad and tested to see if it can survive a 40 foot drop, just so she can be a youtube sensation. My apple ipad is now destroyed and she has 83 views. I know this is totally off topic but I had to share it with someone!

  • I dugg some of you post as I thought they were extremely helpful very useful

  • Hmm it appears like your blog ate my first comment (it was super long) so I guess I’ll just sum it up what I wrote and say, I’m thoroughly enjoying your blog. I too am an aspiring blog blogger but I’m still new to everything. Do you have any points for rookie blog writers? I’d definitely appreciate it.

  • Hey very cool website!! Man .. Beautiful .. Amazing .. I will bookmark your web site and take the feeds also…I’m happy to find numerous useful information here in the post, we need develop more strategies in this regard, thanks for sharing. . . . . .

  • I have been checking out some of your stories and i can claim pretty good stuff. I will definitely bookmark your website.

  • There may be noticeably a bundle to find out about this. I assume you made sure good factors in features also.

  • I will immediately clutch your rss feed as I can not in finding your e-mail subscription hyperlink or newsletter service. Do you have any? Please let me realize in order that I may just subscribe. Thanks.

  • I’ve been browsing online more than three hours today, yet I never found any interesting article like yours. It is pretty worth enough for me. In my opinion, if all website owners and bloggers made good content as you did, the net will be a lot more useful than ever before.

  • Great post. I was checking continuously this blog and I am impressed! Very helpful information particularly the last part :) I care for such info much. I was seeking this particular info for a long time. Thank you and good luck.

  • You are my intake, I possess few blogs and rarely run out from to brand.

  • you have a great blog here! would you like to make some invite posts on my blog?

  • I haven’t checked in here for a while because I thought it was getting boring, but the last several posts are great quality so I guess I will add you back to my daily bloglist. You deserve it my friend :)

  • Keep functioning ,remarkable job!

  • This design is wicked! You definitely know how to keep a reader entertained. Between your wit and your videos, I was almost moved to start my own blog (well, almost…HaHa!) Great job. I really enjoyed what you had to say, and more than that, how you presented it. Too cool!

  • I wish to express my thanks to you just for rescuing me from this type of crisis. As a result of browsing through the search engines and meeting basics which were not beneficial, I assumed my entire life was gone. Existing without the presence of answers to the issues you’ve resolved as a result of this short post is a crucial case, as well as the kind that would have in a wrong way damaged my career if I hadn’t encountered the blog. Your main expertise and kindness in maneuvering all the things was very helpful. I am not sure what I would’ve done if I hadn’t discovered such a stuff like this. I can at this point relish my future. Thanks a lot so much for your specialized and amazing guide. I won’t hesitate to propose your web site to any person who would like guide on this subject matter.

  • It’s perfect time to make a few plans for the longer term and it’s time to be happy. I have learn this put up and if I may I desire to suggest you some interesting issues or tips. Maybe you can write subsequent articles relating to this article. I wish to learn more issues approximately it!

  • Howdy! This post couldn’t be written any better! Reading this post reminds me of my old room mate! He always kept chatting about this. I will forward this article to him. Fairly certain he will have a good read. Many thanks for sharing!

  • Throughout the great scheme of things you’ll receive a B+ for hard work. Where exactly you actually misplaced us ended up being on your specifics. You know, people say, details make or break the argument.. And it could not be much more accurate in this article. Having said that, let me inform you exactly what did do the job. Your text is extremely persuasive which is probably why I am making an effort to opine. I do not really make it a regular habit of doing that. Next, although I can notice the jumps in logic you come up with, I am definitely not certain of exactly how you seem to unite your ideas which inturn make the conclusion. For the moment I will, no doubt subscribe to your issue however trust in the future you link the dots much better.

  • There’s noticeably a bundle to learn about this. I assume you made sure good factors in options also.

  • Hi, Neat post. There is a problem together with your site in internet explorer, could test this?K IE nonetheless is the market chief and a large part of other people will omit your excellent writing because of this problem.

  • Loving the info on this website , you have done outstanding job on the articles.

  • Wonderful beat ! I would like to apprentice while you amend your site, how can i subscribe for a blog website? The account aided me a acceptable deal. I had been a little bit acquainted of this your broadcast provided bright clear idea

  • It¦s actually a nice and useful piece of info. I am happy that you just shared this helpful information with us. Please keep us up to date like this. Thanks for sharing.

  • Thanks a bunch for sharing this with all of us you actually know what you are talking about! Bookmarked. Kindly also visit my web site =). We could have a link exchange contract between us!

  • Thank you for helping out, wonderful information. “It does not do to dwell on dreams and forget to live.” by J. K. Rowling.

  • Thank you for any other excellent article. Where else may anyone get that kind of info in such a perfect manner of writing? I’ve a presentation next week, and I’m at the search for such info.

  • Hello, you used to write magnificent, but the last few posts have been kinda boringK I miss your tremendous writings. Past few posts are just a bit out of track! come on!

  • I think you have observed some very interesting details, regards for the post.

  • Hello there! Would you mind if I share your blog with my twitter group? There’s a lot of folks that I think would really appreciate your content. Please let me know. Cheers

  • You have brought up a very good points, thankyou for the post.

  • I have been exploring for a little bit for any high quality articles or weblog posts in this sort of space . Exploring in Yahoo I finally stumbled upon this web site. Studying this information So i am happy to show that I have an incredibly just right uncanny feeling I came upon just what I needed. I so much surely will make sure to do not disregard this web site and give it a glance on a constant basis.

  • You have noted very interesting points! ps decent internet site.

  • You made some clear points there. I did a search on the subject matter and found most people will approve with your website.

  • Definitely consider that that you stated. Your favorite justification seemed to be at the internet the easiest factor to remember of. I say to you, I certainly get annoyed at the same time as folks think about issues that they plainly do not realize about. You managed to hit the nail upon the top and outlined out the whole thing with no need side-effects , folks can take a signal. Will likely be again to get more. Thanks

  • There is noticeably a bundle to know about this. I assume you made certain nice points in features also.

  • I’ve been absent for some time, but now I remember why I used to love this web site. Thank you, I will try and check back more often. How frequently you update your site?

  • A person essentially help to make seriously articles I would state. This is the very first time I frequented your web page and thus far? I surprised with the research you made to make this particular publish incredible. Excellent job!

  • Some times its a pain in the ass to read what website owners wrote but this site is really user genial! .

  • Someone necessarily lend a hand to make severely articles I’d state. That is the first time I frequented your web page and thus far? I amazed with the research you made to create this actual publish amazing. Magnificent task!

  • You made some decent points there. I regarded on the internet for the difficulty and located most individuals will associate with together with your website.

  • I’m not sure where you are getting your information, but great topic. I needs to spend some time learning more or understanding more. Thanks for excellent info I was looking for this information for my mission.

  • Pretty component to content. I just stumbled upon your site and in accession capital to claim that I acquire actually loved account your blog posts. Any way I will be subscribing for your augment or even I fulfillment you get right of entry to constantly rapidly.

  • I visited a lot of website but I think this one holds something extra in it in it

Leave a Reply

You can use these HTML tags

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>