The homeownership rate fell to the lowest level since 1965. Hero Images/Getty Images
The U.S. homeownership rate hit a 51-year low in the second quarter, falling to 62.9% compared with 63.5% in the first quarter and 63.4% in the year-earlier quarter, the Census Bureau reported Thursday.
The last time the rate hit 62.9% was in 1965, the earliest year for which Census Bureau data is available. The U.S. President was Lyndon B. Johnson.
Homeownership rates vary by region, and some regions have at times had slightly lower rates than the nation as a whole.
The homeownership rate hit its all-time high of 69.2% in the second quarter of 2004, leveled out, then dropped steadily since 2008. Historically, the rate typically has been in the mid-60% range.
So, where have all the homeowners gone?
People who lost their home during the housing crash that accompanied the Great Recession may not have replaced that home, either because they don't want to or they aren't able to qualify for a mortgage today.
Mortgage credit tightened in June, according to the Mortgage Bankers Association, a trade group in Washington, D.C. Mortgage credit has been tight since the recession.
Millennials have begun to move out of their parents' homes into rental apartments; however, their desire to buy a home is a matter of debate. A difficult job market, stagnant wages and high levels of student debt might make buying difficult or impossible for many.
Those who do want to buy might be disappointed by strong sellers' markets and limited supplies of for-sale homes. Supply dropped to just 4.6 months at the current pace of sales in June, according to the National Association of Realtors, a trade group headquartered in Chicago.
US Adds A Healthy 255,000 Jobs, Unemployment Rate Holds At 4.9%
The US economy added 255,000 jobs in July, as the unemployment rate held at 4.9%. This is according to the Bureau of Labor Statistics’ July US employment situation report.
“This is a ROBUST BLS employment report,Allianz’s Mohamed El-Erian tweeted.
University of Michigan professor Justin Wolfers noted that the US has now seen jobs grow for a record 70 consecutive months. All of this reflects a healthy and generally improving US labor market.
Oh, and BTW-- did you know that the US has now seen jobs grow for a record 70 consecutive months?
That's good news.
So there is nothing to worry about for the average citizen. The stock market is booming. A lot of people are getting second jobs, those terrible days when people had to settle for 5.5% interest on their bank savings accounts are over.
The National Debt is looking good, almost at $20 trillion now. Construction is up, wait, no it's down, but that works out, seeing how they won't have to build any new houses anyway. Fill those apartments up.
Still the home ownership is as low as it has been in 51 years. Everything is great.
We can alway give the Bill and Hillary Clinton the money and they will have some of their big donors to the Clinton Foundation build our homes for us like they did in Haiti.
Or
We can just go on vacation there.....
and stay where the donors are staying....
The US has now seen jobs grow for a record 70 consecutive months.
“Here’s what’s so exciting: Job growth is expected to slow as the population ages and as we approach full employment,” Wolfers noted. “But it’s not listening.”
“All that presidential election rhetoric and huge crowds saying there are no jobs out there have it completely wrong,” Bank of Tokyo-Mitsubishi’s Chris Rupkey said. “The jobs data shows the economy is better than voters think.”
Ooooops!
So Tokyo is saying everything is great as well. What about those negative interest rates. I guess that is good. Won't have to keep up with as big of a portfolio.
Want to see Hillary lying about lying. LOL
She may even believe it. Sociopaths often convince themselves.
There have been a number of debates on whether the American Dream is for everyone. First, I believe that the benefits to owning a home have changed drastically. It used to hold a certain financial security but now it's become a burden to some. Thus the rise of the "reverse mortgage".
I don't necessarily think owning a home is for everyone and I don't necessarily think it's always a good financial investment.
PJ, of course owning a home isn't for everyone. Usually when most people don't own a home, it is because they can't seem to afford it, not all but most people.
I don't think renting is a very good investment at all. If you find an investment adviser who tells you different, run away as fast as you can.
At least with that home you own you have equity. You can borrow on it, sell it, rent it, but see what happens when you don't pay the rent next month. Or think about how much you've spent over a 20 year period and your rent has gone up when you could have a place paid for except taxes and insurance. Of course you will have to keep it up and that can be expensive.
I've listened to a lot of investment advisers and the first thing they say is get out of debt and the next thing the good ones say is make an investment in a home you can purchase. You won't get a reverse mortgage on a piece of rental property you are staying in month to month.
After a home the best thing you can do is have income producing property.
If you have income producing worth $500,000, you can expect to get rent of at least three or four thousand dollars a month minus expenses. It you have $500.000 cash you can expect to earn 1/10 that amount or you can stick you neck out on the line and play the stock market.
Personally home ownership is a good investment for me, but I can see where some would see it differently.
I agree with some of what you are saying but what used to be the norm years ago no longer is. Take for instance jobs. People used to work at the same job until they retired. That's no longer the case. We can debate why (age discrimination, professional growth, opportunities elsewhere, change in career path) but the reality of it is that there are many reasons why people no longer own homes and it's not only because they can't afford it. When my mom was growing up it was normal for many people to commute back and forth from the city to their homes in the suburbs and that was partly because it was so hot in the city people didn't want to live there. The younger generation doesn't want to be saddled with mowing the lawn and the upkeep and maintenance of homes. They'd prefer to pay rent and spend their money traveling or saving it for retirement. They also change career and jobs more. By renting they can just pick up and go. The advantages of owning your own home aren't as attractive as they used to be.
Fair enough. I understand it was that way when I was growing up.
My best friend growing up stayed in the Air Force and traveled quite a bit. Every time he moved he rented out the house he was staying in and that pretty much paid the payment. Nothing like having someone else make you payment for you. By the time he retired as a Lt Colonel he owned a half dozen homes.
The values at that time were going up instead of remaining the same as it seems they do in small towns today. There is always the problem of renters though and commercial property can be much better than a lame renter.
Six,
There are a lot of factors why home ownership is down.
I agree that your home is your best investment for most. I not only own my home, it's paid off. I know it's there as a plan B. But I am also aware, the things have changed for most, and as Billy Joel sang in Allentown:
Well we're living here in Allentown
And they're closing all the factories down
Out in Bethlehem they're killing time
Filling out forms
Standing in line
Well we're waiting here in Allentown
For the Pennsylvania we never found
For the promises our teachers gave
If we worked hard
If we behaved
So the graduations hang on the wall
But they never really helped us at all
No they never taught us what was real
Iron and coal
And chromium steel
And we're waiting here in Allentown
Every child had a pretty good shot
To get at least as far as their old man got
But something happened on the way to that place
That song was written in 1983. Ronald Reagan was president.
Great song!
I know a lot of that is true, but it's a little disturbing with these statistics...
The home ownership rate hit its all-time high of 69.2% in the second quarter of 2004, leveled out, then dropped steadily since 2008. Historically, the rate typically has been in the mid-60% range.
You're still in the 60 percentile with the highest in 2004 until 2008 and then steadily declining until it is at its lowest since 1965 today. Don't expect it to be as high as it was even in 2004 or thereabouts, since that was when the bubble was building up and I know things have changed, but mostly since 2008 after the recession hit and is still continuing to go down lower than it was before the bubble started.
I'd say Clinton was the luckiest president ever. He was elected as a recession was ending, presided over the Dot.com bubble, got out right before the next recession without having to do one thing except enjoy his time in office and get credit for a booming economy which had nothing to do with him.
I'd say Clinton was the luckiest president ever. He was elected as a recession was ending, presided over the Dot.com bubble, got out right before the next recession without having to do one thing except enjoy his time in office and get credit for a booming economy which had nothing to do with him.
That is not an accurate depiction of what he did for the economy. What he did was quite unique.
Clinton, during his eight years in office, championed dozens of spending measures that appealed to liberals but had small price tags. At the same time, he enacted welfare reform and made fiscal health a top priority, especially during his second term. A booming economy helped, yet Clinton still demonstrated budget discipline unmatched in modern times.
The above article is very interesting to read. It shows various administrations and how their effect on our economy.
Also Clinton was the only President to give us a surplus. It was the only time that I can remember our debt clock in time square going into the positive.
That clock is a constant reminder to NYers of where we stand... and we take it very seriously.
Also Clinton was the only President to give us a surplus. It was the only time that I can remember our debt clock in time square going into the positive.
Perrie, I don't know where you got that debt clock from, but it is not from Bill Clinton's time in office. That's George Bush's National Debt at some point when he left office. Clinton's was around $6,000,000,000,000. That's not a positive. That's what the National Debt was.
During Bill Clinton's terms the deficit was reduced and the last two years of his presidency there was a surplus, but it didn't erase the National Debt. Part of that surplus was the Social Security tax making it look better than it was. The Republicans controlled Congress during the last two years of his presidency. Then George Bush came in and turned it around adding $4 trillion to that $6 trillion, leaving office with approximately $10 trillion National Debt. Remember Obama saying it was unpatriotic to increase the National Debt $4 trillion dollars in 8 years? LOL
The Dot.com bubble was the biggest thing to help Bill Clinton where millions of extra tax dollars were received by the government. Keep in mind the Dot.com bubble really has been the greatest income producer for the USA since World War II.
The Republicans took over both Houses for the first time in 50 years.
Contract with America and restricting Bill Clinton's spending lowered the deficit.
I still say Bill was a lucky guy in more ways than one. LOL
Contract with America and restricting Bill Clinton's spending lowered the deficit.
What I should have said, but it was too late was played a big part in lowering the deficit and giving the nation a surplus.
Welfare Reform also played a part in it.
Gonna disagree Six,
The Clinton years showed the effects of a large tax increase that Clinton pushed through in his first year, and that Republicans incorrectly claim is the "largest tax increase in history." It fell almost exclusively on upper-income taxpayers. Clinton’s fiscal 1994 budget also contained some spending restraints. An equally if not more powerful influence was the booming economy and huge gains in the stock markets, the so-called dot-com bubble, which brought in hundreds of millions in unanticipated tax revenue from taxes on capital gains and rising salaries.
Clinton’s large budget surpluses also owe much to the Social Security tax on payrolls. Social Security taxes now bring in more than the cost of current benefits, and the "Social Security surplus" makes the total deficit or surplus figures look better than they would if Social Security wasn’t counted. But even if we remove Social Security from the equation, there was a surplus of $1.9 billion in fiscal 1999 and $86.4 billion in fiscal 2000. So any way you count it, the federal budget was balanced and the deficit was erased, if only for a while.
Update, Feb. 11: Some readers wrote to us saying we should have made clear the difference between the federal deficit and the federal debt. A deficit occurs when the government takes in less money than it spends in a given year. The debt is the total amount the government owes at any given time. So the debt goes up in any given year by the amount of the deficit, or it decreases by the amount of any surplus. The debt the government owes to the public decreased for a while under Clinton, but the debt was by no means erased.
In 2000, due to an improving debt situation, the clock started to run backward. [8]
That was towards the end of the Clinton years.
And where G Bush numbers look like this:
George H. W. Bush (1989–1993)—Revenue increase: 16 percent; spending increase: 23 percent; GDP growth: 22 percent; national debt: $4.4 trillion
Clinton's looked like this:
Bill Clinton (1993–2001)—Revenue increase: 72 percent; spending increase: 32 percent; GDP growth: 54 percent; national debt: $5.8 trillion
My only mistake in this discussion was interchanging the words debt for deficit. They are not the same thing.
Gonna disagree Six,
Perrie, everything I said is in your comment. LOL
In fact the Republicans controlled both Houses the last 6 years of Clinton's time as president for the first time in 50 years.
Clinton did set the stage with the tax increase his first year, but without the Social Security Tax, the Dot.com bubble, like it says in your comment along with huge profits in the stock market we would have never had a surplus.
Look at this graph you must have forgotten to put in your comment.
Keep in mind the Republicans had both House for the last 6 years of his term as president.
He didn't have a surplus until 1998. As you can see the Republicans were reducing the deficit, but were not able to have a surplus until 1998. It was not Clinton who reduced the deficit. His first year tax increase was part of it, but remember "Read my lips" when HW Bush said he wasn't going to increase the taxes, but did anyway.
When Clinton started his term as president, the USA was coming out of a recession, the dot.com bubble was really kicking in causing more people to have jobs, pay more Social Security taxes and as you will realize, I hope, the "Contract with America" Newt Gingrich came up with the Republicans determined to end the deficit in 7 years and they did.
If you can't see that and still think Clinton erased the deficit then I'd say you're arguing just for the sake of arguing or disagreeing for the sake of disagreeing. If Clinton did anything he increased the taxes his first year after HW Bush had already increased them and that did play a part in reducing the deficit and creating a surplus, but his biggest credit was due to getting along with the Republicans even if they had to twist his arm.
Now George Bush was another story.
That $263.2 billion is with the extra Social Security taxes received. Without them it would have been less than a $100 billion surplus, so you see how much the booming dot.com bubble played in the surplus from the increase in Social Security tax revenue.
Read this as well.
Anyway you last comment is, for all practical purposes saying the same thing I said, so if you read your comment and think about it you are disagreeing with yourself.
You'll see if Hillary gets elected how good Clinton is with the deficit since Hillary said she was going to let him handle it.
The Republicans had to fight him for 6 years to get that surplus.
Revenue increase: 72 percent for Clinton
He didn't cause the dot.com bubble. He was lucky the economy was booming, due to nothing anyone did to cause it to happen.
Assuming that rent is cheaper than a mortgage and you put what you might have used for a down payment into retirement savings rather than an extra trip or eating out too much, the difference being invested in retirement would need to come up with an extra 700-2000 a month depending on location and house size to break even with a homeowner and paid off mortgage. I'm old fashioned I guess. I've worked for the same employer for 30 years and lived in the same house for 20.
Home ownership is almost always a good investment. Usually the best one. For me, my mortgage is cheaper than renting a three bedroom apartment and the same as a two bedroom. That includes escrow for taxes and insurance. There is not a better position to be in during retirement than to have no rent or mortgage payment. All that money freed up when on social security and pension/IRA is huge for middle class people. My retirement is just under 11 years away and mortgage payoff just over 8 years. I expect if I work straight through to retirement age that I will retire mortgage and debt free. The latter has a ways to go. Paying money to live in someone else's building for a lifetime and having nothing to show for that money is a tragic waste in my opinion.
Fox News Poll: Clinton Leads Trump By 10 Points
Majorities think Clinton is nevertheless qualified to be president, and has the temperament and knowledge to serve effectively.
It’s the opposite for Trump: over half feel he is not qualified, and lacks the temperament or knowledge to lead the country.
And his 62 percent dishonesty rating tops hers.
Oh my!
Fox News Poll: Clinton Leads Trump By 10 Points
I remember some time ago when you had to take courses every year to renew your insurance license. Someone discovered there was a template for the test and no matter what the questions were, all a person had to do was follow the template and they would have a perfect score.
That's the way it is with Hillary. All she has to do is follow the template no matter how many lies she has told or how many corrupt things she has done, just like Obama, she will have a perfect score since she can get away with murder and those who feed the citizens of this country will not expose her.
I'm not a Trump fan. I don't want him as president. I don't want Hillary as president either, but it is not a toss up, because of what I do know.
This is indeed bad news. Obama has been terrible in creating an economy where more could afford a home to own