Homeownership Rate Stays Near Historic Lows

The number of households owning homes reached 75,076,000 in the third quarter, increasing from 74,832,000 in the second, but down from 75,251,000 a year ago, the Census Bureau reported Tuesday.

At the same time, the nation’s homeownership rate (seasonally adjusted) remained at 65.5%.
The homeownership rate stayed near historic lows. The rate in the first quarter was 65.4%, the lowest since the first quarter of 1997, when the rate was also 65.4%. The homeownership rate peaked at 69.2% in the second quarter of 2004. The rate measures the proportion of households owning their primary residence, computed by dividing the number of households that are occupied by owners by the total number of occupied homes.
The Census Bureau also reported the homeowner vacancy rate fell in the third quarter to 1.9 % nationwide, down from 2.% in the second quarter and 2.4% one year ago. The homeowner vacancy rate—the proportion of the homeowner inventory for sale that is vacant for sale—is at its lowest level since Q3 2005.
The number of housing units for sale in the third quarter, Census reported, was 1,476,000, down from 1,595,000 in the second quarter and 1,862,000 in third-quarter 2011. The number of housing units held off the market was 7,190,000, down from 7,612,000 in second quarter but up from 7,190,000 a year ago.
The stagnant homeownership rate combined with a decline in the number of units held off the market suggests opportunities for home sales. At the same time, the profile of homeowners by age is changing.
The homeownership rate for older Americans—defined as 65 and over—fell in the third quarter to 81.4% from 81.6% in the second. The homeownership rate for Americans younger than 35 fell to 36.3%. The 45-64 age bracket was actually the only group to see an increase in homeownership; the rate for that group increased 0.6% age points to 72%.
The rental vacancy rate—the proportion of the rental inventory that is vacant for rent—in the third quarter remained at 8.6%, the lowest level in 10 years, underscoring a shift in housing patterns.
According to the quarterly report, the number of housing units in the third quarter was 132.8 million, an increase of 121,000 from the second quarter and 487,000 since third-quarter 2011. According to the Census Bureau, 18,145,000 units were vacant, down from 18,518,000 in the second quarter and 18,804,000 in third-quarter 2011.
The highest homeownership rate in the third quarter was in the Midwest—69.6%, unchanged from the second quarter. Homeownership also increased in the West (to 60.1%) and the Northeast (to 63.9%), making the South the only region to experience a decline (to 66.9%).
The median asking sale price for a vacant home rose to $137,000 in the third quarter from $134,600 in the second and from $136,700 one year earlier. The median asking rent in the third quarter fell to $706 from $716 in the second quarter but is up from $700 in the third quarter of 2011.