The U.S. homeownership rate ticked up slightly in the third quarter, but this is likely a seasonal fluctuation. The rate was 66.3% (up from 65.9%) of U.S. households and 70.3% (up from 70.0%) of Midwest households.
The rate was steady at between 62% and 65% until 1995, when rates increased to a U.S. maximum of 69.2% in 2004. They have since fallen steadily, notwithstanding the slight increase last quarter.
Some media outlets questioned whether this signaled a “reversal” in declining homeownership; however, the chart shows about five clear incremental increases in the homeowner rate during the period in which it has fallen overall. The U.S. is still about 2 percentage points above the historical average.
The future stable homeownership rate is likely to be above that historical average because of innovations in housing finance, including securitization, which will likely not go away after the market settles.
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