Homeownership Rate Declines in U.S.
Many Former Homeoners Moving Back to Rental Housing
The fourth quarter of 2009 saw U.S. homeownership fall to the lowest point in nearly ten years. While pending sales of existing homes ticked up 1%, the National Association of Realtors saw reason to hope that the real estate market is steadying.
Still, the number of Americans owning their home reached a low not seen since 2000, when the percentage stood at 67.3%—exactly where it was in the fourth quarter of 2009.
Some experts see the decline as a positive shift away from recent years, when homeownership was considered attainable by everyone, regardless of credit history, income, employment status, or ability to repay a mortgage. The current mess in the housing industry, overbuilding by construction companies, and entire financial industry collapse of late 2008 is blamed in part on “creative” mortgages to feed the homeownership frenzy.
That frenzy peaked with a high of 69% in 2004 when the combination of low interest rates and easy credit moved families out of rental housing and into houses of their own. Fast-forward to 2007 through 2009, for the results of the bubble: nearly four million homes lost to foreclosure.
The homeownership rate would likely have fallen farther, without the federal first-time buyer tax credit boosting sales. The credit is scheduled to run thorugh April 2010.
The news signals that homeowners are moving back to alternative housing situations: while some are moving in with family, many others are becoming renters—again.