Competition has remained strong going into a traditionally slower season. Why isn’t the homeownership rate surging?
In the fourth quarter of 2021, the homeownership rate saw a slight decrease compared to a year earlier. The nation has 83.5 million owner-occupied households, which brought the homeownership rate to 65.5%. That is up only slightly compared to the third quarter (65.4%), and it’s 0.3 percentage points lower than the same quarter in 2020, according to newly released U.S. Census Bureau data.
Housing supply shortages persist in the housing market, keeping ownership rates from climbing. New-home construction continues to lag behind strong buyer demand too, as builders face labor and lot shortages as well as rising material costs.
“The issue is supply—you can’t buy what’s not for sale,” Odeta Kushi, deputy chief economist for First American Financial Corp., said in a statement. “The rental vacancy rate in the fourth quarter hit a 38-year low, while the homeowner vacancy rate remained at the lowest level in the series’ history. Our analysis shows that in the fourth quarter, the housing deficit increased and is now about 1.76 million units.”