The plunge in prices following the real estate bubble burst has made housing perhaps the most affordable in our lives, which has contributed to stabilization of housing ownership. That affordability is countering the megatrend of younger individuals becoming renters rather than pursuing homeownership.
While U.S. homeownership rates have returned to a normal 65 percent level nationwide, that varies greatly from state to state — see my blog on state homeownership rates. Homeownership rates at the end of 2012 ranged from a low of 53.1 percent in New York (although the District of Columbia is less at 44.8 percent, it is not state), to a high of 76.7 percent in West Virginia.
The following table lists the 75 largest Metropolitan Statistical Areas (MSAs) along with the corresponding homeownership rate as of the fourth quarter 2012. Since these are based on samples, each quarter the sample mean can vary within a range. To remove that random noise from quarter-to-quarter, a four-quarter moving average was calculated for each MSA. The far right column is calculated by subtracting the maximum four-quarter moving average from 2005 through 2012 from the four quarter average for 2012.
The top 25 MSAs for homeowner rates in the largest 75 MSAs are detailed in the following table, as sorted by the four-quarter 2012 average.
Those MSAs with the lowest rate of homeownership include:
And which MSAs saw the smallest and greatest change in homeownership rates from 2005 through 2012?
The one thing you can quickly conclude, after even just a cursory review of these data, is that there is no simple factor that can explain the variability from city to city. Without question, homeownership and resulting rates of homeownership are a function of many economic and demographic factors.
To see the complete U.S. Census Bureau data sets and reports, click here.