Interest Rate Roundup

Friday, July 27, 2007

Census: Homeownership falls, vacancy rate dips in Q2

The Census Bureau just released details (PDF link) on second-quarter homeownership and vacancy rates. In the quarter ...

* The U.S. homeownership rate fell again. It dropped to 68.2% from 68.4% in Q1 2007. The homeownership rate hasn't been this low since Q2 2003.

* Looking at the longer-term chart (This one goes all the way back to 1965), you can see that homeownership rates soared throughout most of the past decade and a half. Falling interest rates and much more aggressive financing are the reasons. With credit conditions tightening up and interest rates no longer declining, we'll likely see homeownership rates stagnate or decline for the foreseeable future.

* If there's one bit of good news in this report, it's that the homeowner vacancy rate actually declined -- to 2.6% from the record-high 2.8% in Q1 2007. It is still well above normal, however. Until the housing bubble burst, we had never seen a vacancy rate above 1.9% since record-keeping began in the 1950s.


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