Eventually, and sooner rather than later, even the news won’t be able to continue whitewashing the fact that America is in serious decline.
Home prices are rising, and homeownership is falling. How can that be?
If prices are rising, it must be because there is increasing demand for homes, but if there is increasing demand, then why are there fewer homeowners?
It has to do with this: math. The homeownership rate in the first quarter of this year fell to 63.7 percent, the lowest since 1990, according to the U.S. Census. The homeownership rate is the ratio of households that own to overall households—the remaining being rental households.
We already know that rentership has increased dramatically, and continues to do so, as the economy improves and more kids move out of their parents’ basements and into rental apartments. Rental vacancies are at historic lows. Rents are soaring.
The pool of total “households” or occupied houses, which includes both owners of those houses and renters of those houses, is getting bigger. The gain is all on the renter side, the census report also notes. That therefore means that the share of owners of that total pool, which is the homeownership rate, must get smaller, even if there wasn’t a big drop in the actual number of people who own homes. There’s the math.
Full article: Homeownership rate lowest in 25 years (CNBC)