Home Hunters Finally Favor Buying Over Renting
WASHINGTON – May 2, 2017 – For the first time in a decade, more new households chose to buy a home rather than rent one in the first quarter of 2017, according to Census Bureau data. About 854,000 new households purchased a home – more than double the 365,000 new households who chose to rent.
New homeowners haven’t outpaced new renters since the third quarter of 2006.
The overall homeownership rate in the first quarter of 2017 was 63.6 percent, down slightly from 63.7 percent in the fourth quarter of 2016. But economists say the increase in new households who purchased could signal a turnaround in the long-term decline of the overall homeownership rate, according to The Wall Street Journal.
In the mid-2000s, the homeownership rate peaked at about 69 percent. In the second-quarter of 2016, it hit a 50-year low of 62.9 percent but has been gradually climbing since then.
“People are looking at housing as being a bit more attractive, as memories of the financial crisis fade,” Joseph LaVorgna, chief U.S. economist at Deutsche Bank, says.
Indeed, existing-home sales zoomed to their strongest sales pace in a decade in March, according to the National Association of Realtors®. New-home sales also edged up 5.8 percent in March.
Source: “Rent or Buy? More Young People Are Choosing Homeownership,” The Wall Street Journal (April 27, 2017) [Log-in required.]
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