According to the Census Bureau’s Housing Vacancy Survey (HVS), the nation’s homeownership rate in the second quarter of 2019 fell to 64.1%, the lowest since the third quarter of 2017. But it is statistically unchanged from the first quarter of 2019 (64.2%) and a year earlier (64.3%). Compared to the peak of 69.2% in 2004, the homeownership rate is 5 percentage points lower and remains below the 25-year average rate of 66.2%. The recent declining homeownership rate is largely due to housing affordability concerns.
The housing stock-based HVS revealed that the number of households increased to 122.5 million in the second quarter of 2019, 1.2 million higher than a year ago. Newly gained households were almost equally split between renters and owners. The number of renter households increased by 599,000. At the same time,585,000 homeowner households were added. This stands in sharp contrast with the 2017-2018 trend when most of household formations were concentrated in the owner-occupied sector.
Homeownership rates declined for most age groups on a year-over-year basis. The homeownership rate for household heads younger than 35 years old (36.4%) decreased by 10 basis points from the second quarter of last year. The largest decline, however, was for those ages 35-44 (59.4%), with an annual drop of 60 basis points, followed by households ages 45-54 (70.1%) with a decrease of 50 basis points.
The nonseasonally adjusted homeowner vacancy rate continued its downward slide that began after the Great Recession. It hit a new cyclical low of 1.3%, 20 basis points lower from the rate in the second quarter of 2018. The national rental vacancy rate stayed at 6.8%.