The U.S. Census Bureau recently
released their 2019
Q2 Homeownership Report. Some began to see the sky falling,
believing the report showed Americans may be stepping back from their belief in
The national homeownership rate (Americans who owned vs.
rented their primary residence) increased significantly during the housing
boom, reaching its peak of 69.2% in 2004. The Census Bureau reported that
the second quarter of 2019 ended with a homeownership rate of 64.1%, which is
down from the 64.8% rate for the fourth quarter of 2018. Based on this news,
some started to question the consumer’s belief in the idea of homeownership as
a major part of the American Dream.
Calm Down…It is true the homeownership rate
did fall. However, if you look at the national rate over the last 35 years
(1984-2019), you can see that the current homeownership rate has returned to
historical norms. The 64.1% rate is equivalent to the rates in 1984 and 1994.
Will the Future Bring? Part of
the reason the homeownership rate slipped is a lack of inventory available for
purchase for first-time home buyers. The demand is there, but currently, the
supply is not. It seems, however, that is about to change.
In a recent report, Ivy Zelman explained that builders have
finally started to increase the number of homes they’re constructing at the
lower-end price points:
“Robust growth in the entry-level
price point of late should translate to a reacceleration in homeownership rates
Today, the homeownership rate sits at historic norms. In all
probability, it will increase as more inventory becomes available. There is no
reason for concern.
Many homeowners believe that rising interest rates and home prices have scared away buyers and therefore have not listed their houses for sale. However, the truth is that buyers who were unable to find a home last year are out in force, and there are even more coming!
“Approximately one-third (32%) of Americans plan to purchase a home in the next five years. Millennials are most likely to have such a purchase in their five-year plan (49%), versus 35% of Generation X and 17% of baby boomers.”
As we can see, buyers are optimistic! According to the report, here are the top reasons Americans plan to buy:
The most common reason Americans prioritize buying is that they believe it’s a good investment!
If you’re a homeowner looking to sell, 2019 is the perfect year to put your house on the market. But why?
Buyers want to buy
At least 3 of the renowned organizations that report on real estate market trends predict that homeowners are going to wait until 2020 to list their homes, leading to a nice increase in sales (as shown in the graph below).
Don’t wait for a competitive market; be ahead of the curve and sell your house at the best possible price!
There are more and more buyers entering the market every day! Whether you’re a first-time homebuyer or a current homeowner looking to move-up to your next home, sit with a real estate professional who can help you with your real estate needs!