Homeownership Rate Spikes in Latest Quarterly Resultsadmin
The latest report on home ownership released by the Census Bureau shows the U.S. home ownership rate rose to 64.8% in the third quarter, matching the highest level since 2015.
The sharp increase is gaining added attention because it comes after two quarters of declines.
However, as John Affleck, CoStar’s vice president of market analytics points out, there’s more going on behind the numbers than typical market dynamics. “The government shutdown at the beginning of the year likely disrupted data collection and could have skewed the homeownership statistics,” Affleck notes.
Affleck has consistently cited homeownership as a key risk to the multifamily sector.
According to Affleck, “a one-percentage point increase in the homeownership rate over the course of a year equates to a decrease of about 800,000 renter households.”
That means high-rent units in relatively affordable homeownership markets could be most at risk, as affluent renters choose to own instead. Single-family home construction has headed lower this year. At the same time, sales volume has slowed, while multifamily demand keeps setting records.
Affleck says it’s important to keep a close eye on this indicator going forward to determine a long-term analysis.