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Homeownership Declines again, Rents Continue to Escalate

by devteam April 29th, 2015 | Share

Homeownership rates continued to fall during the firstrnquarter of 2015 while vacancy rates were stable in the short term.  The Census Bureau said today that the homeownershiprnrate was 63.7 percent during the quarter, 1.1 points below the rate one yearrnearlier and 0.3 percentage point lower than in the fourth quarter of 2014.</p

The homeownership rate in the U.S. peaked in the second andrnfourth quarters of 2004 when it hit 69.2 percent but has fallen steadily sincernthen.  The current rate is lower than atrnany time in the data provided by the Census Bureau, dating back to the firstrnquarter of 1995.  </p

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The homeownership rate in the first quarter was highest inrnthe Midwest at 68.6 percent and lowest in the West at 58.5 percent.  The Northeast and South were at 61.1 percentrnand 65.1 percent respectively.</p

Rates fell on a year-over-year basis for all age groups but homeownershiprnremained more than twice as high for the oldest age group than thernyoungest.  Seventy-nine percent of thosernover age 65 own homes compared to only 34.6 percent of those under 35.  The rate for the oldest group was down 0.9 pointrnfrom a year earlier while the rate for so-called Millennials decreased by 1.6rnpercentage point.</p

The vacancy rate for rental units in the first quarter was 7.1rnpercent, down from 8.3 percent one year earlier and 0.1 percent higher than inrnthe previous quarter.  Homeowner vacanciesrnwere at 1.9 percent, unchanged from the previous quarter and down 0.1 percent year-over-year.rn</p

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There were an estimated 133.58 million residentialrnproperties in the U.S. in the first quarter, 87.0 percent of which werernoccupied.  Of those 55.4 percent werernoccupied by owners and 31.6 percent by renters. rnOf the vacant 17.3 million properties, 3.3 million were for rent andrn1.41 million were for sale.  Most of the remainingrnvacant units were seasonal (4.5 million) or held off of the market for a varietyrnof reasons (7.2 million).</p

The median asking price for vacant rental units continued tornrise and is now $799 per month, up about $150 from pre-recession levels.  The median asking price for a vacant for salernunit in the first quarter of 2015 was $149,500, compared to the pre-recessionrnmedian of $200,000.</p

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About the Author

devteam

Steven A Feinberg (@CPAsteve) of Appletree Business Services LLC, is a PASBA member accountant located in Londonderry, New Hampshire.

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