According to the Wall Street Journal, for the first time in 13 years homeownership is up.
After the housing market crash nearly a decade ago, this increase in homeownership shows that the market is finally starting to recover. It also shows that the federal government programs to boost ownership worked and the market is back on track. As a result, in 2017, homeownership went from 63.4% in 2016, to 63.9%, a .5% increase over the year. The last time homeownership increased over a year was between the years 2003 and 2004.
Millennials Are Finally Driving The Housing Market
Millennials who in recent years have avoided homeownership because of high home prices, a lack of new development leading to a short supply of homes, and difficult lending conditions, have finally been able to enter the market. In recent years, because of domestic economic growth and the return of consumer confidence they are much more apt to invest in a home now. 36% of millennials are now homeowners, slowly catching up to Gen Xers whose homeownership rates are about 58.9% and Baby Boomers whose ownership rates range from 69.5%-79.2% depending on their age group.
Homeownership Rates Vary Across The Country
Though sitting at 63.9% overall, homeownership rates vary depending on home affordability. Broken down by region the Midwest is at 68.7%, the South is at 65.8%, the Northeast is at 60.6%, and the West Coast is at 60%. In Providence, the median home price is comparatively low at $310,000, so we will also see the benefits of this increase of homeownership, even though our region is a little less than average.
Higher Homeownership Rates Are Good News For Everyone
This uptick in homeownership is extremely good news for our country. First, it shows that consumer confidence has returned and people are starting to invest in homes again. A great sign of the economy and employment rates. Secondly, millennials who reached adulthood during the market crash, no longer have to delay buying a home. They can now join other generations in achieving this life goal. Thirdly, it means that sellers will have a better chance of getting a fair market price for their home in a shorter amount of time. So if you are thinking of listing, now is the time to act. Even with the limited number of homes on the market driving competition and prices, this increase is a great sign. After the years following the housing market crash, the worries of foreclosure and unemployment, it seems we are finally back on track. Right now the market is extremely favorable to both sellers and buyers, even millennials, so it’s a great time to consider investing in a home. With these growth rates, it’s likely we’ll see another great year for the market in 2018.