Homeownership: The Real Story Behind The Headlines

The big housing news this week is that the home ownership rate has dropped to 63.4% which represents the lowest rate in 48 years. That news definitely is making headlines. Yet, to fully understand what this means we have to look at the story that created these headlines. There is no doubt the home ownership rate has declined since the housing crisis. Here is a graph showing the home ownership rate over the last twenty years. It skyrocketed during the housing boom and has steadily fallen since the bust: The story behind the headline… The dramatic fall in the rate over the past year must be looked at very closely. The rate is determined by the “number of households” who rent versus those who own. Let’s assume you have nine friends that live on their own (thus forming a household); six of them own and three of them rent. That would mean that 66.6% (6 out of 9) of your friends that live on their own are homeowners. Now, let’s assume you have another friend who has been living wi
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