According to the latest Housing Vacancies and Homeownership release from the U.S. Census Bureau, the homeownership rate jumped to 64.8% in the third quarter of 2019. This is up 0.4 percentage points from the third quarter of 2019. The increase was driven by a combination of very strong growth in owner households and a decrease in renter households. What’s more, strong owner demand combined with low housing inventory is helping drive homeowner vacancy rates to lows not seen since the early 2000s.
The third quarter of 2019 experienced significant growth in new owner households with an increase of nearly 1.4 million new owner-occupiers. Eight out of the past 10 quarters have now seen owner household growth surpass one million. At the same time, the number of new renter households actually fell by 33,000. This could indicate the start of another upward trend in the homeownership rate as a low mortgage rate environment helps entice some renters to make the switch to homeownership.
What’s more, the healthy demand for homeownership has helped to bring down homeowner vacancy rates to levels not seen since 2002. While a sign of healthy demand for owner-occupancy, it is also an unfortunate consequence of underbuilding in the United States this economic cycle, and surely represents a strong headwind for households looking to make the switch from renting to owning. ©2019 CoreLogic, Inc. All rights reserved.