Economic research

Homeownership rate in the fourth quarter reflects slight growth and demographic disparities

Q4 2021 Home ownership and vacancy
What happened this quarter:

The country’s 83.5 million homeowner households have pushed the home ownership rate to 65.5% in the fourth quarter of 2021, up slightly from the third quarter and down 0.3 percentage points from the same quarter in 2020, as the economy and housing markets continue to normalize to the following the pandemic.

Different results according to age:

The homeownership rate is strongly influenced by age. The oldest households, those aged 65 and over, have the highest homeownership rate in the country (79.4%), while the youngest households, those under 35, have the lowest rate (38.3%). Homeownership rates rise sharply as young households age, with the rate among 35-44 year olds rising to 61.4% in Q4 2021, just below the US average. Given that the oldest millennials will turn 41 this year, and more than 45 million millennials are still at the age of homeownership, this demographic is the primary demand factor driving competitive housing market conditions. Over the past year and since the third quarter, homeownership rates were stable or higher for middle-aged households (those between 35 and 54). Meanwhile, homeownership rates have declined for both younger and older households.

2021Q4 Ownership rate by age

Different results by race and ethnicity:

In addition to age, we find persistent relationships between homeownership rates for different racial and ethnic groups. Since the third quarter and a year ago, the homeownership rate for Black households has declined and remains the lowest among the racial and ethnic groups tracked. Hispanic households saw changes that were not statistically significant, while Asian, Hawaiian and Pacific Islander households saw gains in homeownership rates in the quarter and last year. The homeownership gap reflects the challenges many Americans face in accessing housing and related services. It’s also one of the reasons why launched its Microsite “For all”which offers resources and advice to help achieve the goal of equal opportunity in housing and professional services for all, as well as the details of what thinks about fair housing and why.

Ownership Rate Chart by Race and Ethnicity in Q4 2021

What vacancy means for the housing market:

Despite recent gains in construction, the the housing shortage persists as evidenced by the historically low vacancy rates in the fourth quarter, for both owned and rental accommodations. The rental vacancy rate hit a 38-year low, while the homeowner vacancy rate remained at the lowest level in the data’s 66-year history. About 38% of vacant homes are in a state of transition – for rent, for sale or rented/sold – while 62% of vacant homes are held off the market for vacation, temporary use or other reasons. With vacancy rates limited among owned and rented accommodations, fourth quarter census data showed rising housing costs across the board, in line with trends in asking prices for houses for sale and rentals that we saw in real estate data.

Danielle HaleDanielle Hale