Could Homeownership Be Headed For 50 Percent?
Will the homeownership rate fall below 50 percent? Not a question most housing industry stakeholders want to think about, but some analysts are speculating that it could happen. Freddie Mac, in its June edition of Outlook, takes a look at some of those predictions.
The company’s economists start out by reiterating their oft-stated conviction that 2016 will be the best year for housing in a decade. Despite a generally weak economy they expect housing to “be an engine of growth,” with residential investment providing a direct boost and higher home equity contributing to consumer confidence and leading to higher consumer expenditures. But they concede that the outlook for homeownership is mixed.
The rate of homeownership has declined precipitously since hitting a peak of 69 percent during the housing bubble. It fell to a 40-year low a few quarters ago and has remained below 64 percent. Many analysts, Freddie says, expect to see the rate fall even further.
While most do not expect it to fall under 50 percent, Freddie Mac says a number of recent articles, all published in CityScape have set out a range of plausible scenarios where a drop of 20 percentage points in the rate could happen by 2050.
Much more here…