Magazine article Mortgage Banking

Housing Futures

Magazine article Mortgage Banking

Housing Futures

Article excerpt

There is a lot of uncertainty right now about where homeownership is headed. The balancing act between owning and renting is actively playing out--and will be for a while as the echo boom makes its presence fully felt in the market.

We are on the cusp of finding out whether millennials will hang onto their preference for renting--or turn to buying when they start families of their own (whenever that happens). And housing policy has yet to find a way to unleash the full buying power of minorities, especially Hispanics.

All of this was in a state of flux as we tried to evaluate the home-buying landscape this month.

In his article, "Equity for All," First American Chief Economist Mark Fleming connects the dots between the downward trend in the homeownership rate and growing income inequality. He takes us through the history of homeownership and income growth--as well as the tanking of both--in the wake of the Great Recession.

Fleming writes, "At the turn of the 20th century, fewer than 50 percent of Americans owned their homes. This number, following gains in the economy, steadily grew for the next 100 years. Between 1960 and the mid-2000s, homeownership rates in America rose from 62 percent to nearly 70 percent."

But, he adds, "[I]n the wake of the Great Recession, homeownership trends have been heading in the wrong direction. The percentage of Americans who own a home has fallen to 64 percent--a 5 percent drop in just the past eight years. …

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