By Mike Wheatley | Realty Biz News
The U.S. home ownership rate posted declines across all four regions of the U.S. in the fourth quarter, plunging to its lowest level since the third quarter of 1994. But a sharp rebound in household formation during the quarter has more economists optimistic that a turnaround in the home ownership rate is on the horizon.
The home ownership rate fell from 64.3 percent in the third quarter to 63.9 percent in the fourth quarter, reaching a 20-month low, the Commerce Department reported Thursday.
In 2004, the home ownership rate peaked at 69.4 percent. While the home ownership rate fell, however, household formation more than quadrupled during the fourth quarter to 1.7 million from 356,000 a year ago. The gains were mostly driven by renter households, the Commerce Department reported.
Still, housing analysts are optimistic from signs that household formation is picking up, particularly as the labor market strengthens too and credit requirements for qualifying for a mortgage are loosened up.
