Possible Lower Homeownership Rate

Per Marketwatch:

Brace yourself: The decline in homeownership rates may last until 2030.

The homeownership rate will hit 61.3% by 2030, down from 65.1% in 2010, according to a new report from the Urban Institute, a nonprofit and nonpartisan organization that focuses on social and economic policy. From 2010 to 2020, of the 11.6 million new households, 8.9 million (77%) will be nonwhite: 4.6 million (39%) Hispanics, 2.2 million (19%) blacks, and 2.1 million (18%) others. There is also a rental surge afoot: From 2010 to 2030, there will be 4 million more new renters than homeowners; 13 million people will rent, but only 9 million will buy.

And yet it’s increasingly expensive to rent. The gap between rent and household income is widening to “unsustainable levels,” according to research published in March by the National Association of Realtors found. In the last five years, a typical rent rose 15% while the income of renters grew by only 11%, the study found. The top markets where renters have seen the highest increases since 2009 are New York (51%), Seattle (32%), San Jose, Calif., (26%), Denver (24%) and St. Louis. (22%).

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