Homes are expensive these days, but that doesn't seem to be stopping anybody. Among young families, the homeownership rate is currently 35%, higher than it's been anytime in the past 30 years outside of the housing bubble years.
28 thoughts on “Raw data: Homeownership among the young”
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It looks like, by your definition, that housing bubble lasted from 1998-2011. So about half of your 30 year period.
Yes. Kevin needs to stop posting on housing related topics. Hes so wedded to his conclusion that hes forced to make comical blunders in nearly every post.
I’m not clear what his blunder is in this post. It’s not like he’s hiding the ball here. We can all see the chart, and his headline is not obscuring the post with a misleading title. Unless you think his readers are too stupid to draw their own conclusions in the face of his description of the rise and fall of rates as “the housing bubble years”, which is hardly inaccurate to begin with.
What relevant data is missing and how does it change the picture in this “raw data” post?
Its this description of the data that is painfully bad- "higher than it's been anytime in the past 30 years outside of the housing bubble years."
This is a very deceptive way to present raw data.
All he's saying is that it's basically reverted to the mean after the fallout of the early 00's housing bubble and recession. Why is that such an outlandish reading of the data?
But he didnt say that.
I would agree that he could have described the chart in a different way that would not have been misleading.
But he did not.
'Higher than its ever been except for the times it was higher, but you should ignore those other times....HIGHER THAN ITS EVER BEEN!'
Definitely the most misleading way to frame the data. Definitely could have described the data accurately, but chose not to.
It’s fine if you disagree with his description of the data, but calling it “deceptive” is absurd. The data itself is the most prominent part of the post. If he hid the chart behind the link or titled the post with his description, it might be a justified thing.
No need to inflate the language so aggressively.
Well, I disagree. His description is deceptive.
The fact that he posted the chart doesnt change the fact that his description of it is very misleading...or, deceptive.
Your argument now is that it isnt fair to label his misleading description as deceptive because you can imagine a post that is even more deceptive.
This does not make any sense.
"... So about half of your 30 year period."
Yes, arbitrarily throwing out all the years that don't support your argument seems just a bit questionable.
During the bubble years many people, not just young, were taking on mortgage payments that they couldn't sustain - it was a delusional era.
But the main conclusion is that the rate is about the average for the period, and rising.
The home ownership rate (all ages) increased from 63% in 1964 to 66% now:
https://www.census.gov/housing/hvs/data/histtabs.html
Probably there were more young owners then - the age data don't go back that far. But the data certainly don't support the idea that there is now an acute overall shortage, unless there has been one for the last 60 years. If the population shrinks this could make housing more abundant (even if Trump doesn't kick millions out of the country).
Various factors such as the banks-running-wild years and the super-low mortgage rates of 2020 influence the rate temporarily. The main problem may be the shift toward more expensive housing.
What do the missing years show?
Millennials seem dumbfounded when I tell them I did not own a house until I was 40. It seems they believe that boomers, and even gen-X like me lived at a time when houses grew on trees and fell from the sky like manna. Or something. Same for jobs...
I’m right on the cusp between boomers and gen x. I bought my first house in my mid 30s. A fairly modest one.
It's interesting how one's anecdotal experience can be so different. My social circle is full of people priced out of buying during the bubble, when they were in their 20s. But their early thirties matched up with Obama's 1st time buyer incentives. They were buying homes in 2008-2011 like mad.
Those poor young owners of 2006. Many spent years underwater on their mortgage, too poor to pay thousands if they tried to sell.
Others alluded to it, but it’s most unfortunate that data on homeownership only apparently began in 1990. I wonder what % of young people aged 25-29 owned a home in the years 1950-1989, in the era of “single breadwinner” households. I guess there’s no way of knowing.
It would be coarse on timing, but census data perhaps?
I wonder the same thing. I see this chart and can't assign a lot of weight to it in either direction because there's just not enough historical context.
The dead giveaway on this one is the term “young families“.
If you don’t consider changes in the age at which young people are marrying then these numbers are quite meaningless. In fact, they may be driving the increase toward the end of the graph. If only those with , say, professional degrees van afford to buy a house and hence start a family, then all those priced out of homeownership and family formation would drop out of the numbers and cause the rates to go up
Go back to 1960 and young people and old people owned homes at almost the same rates -- between 60 and 70%. For both groups, rates rose until 1980, then but diverged. Things are improving for young families, but homeownership rates for them are still historically low for the post-WWII period.
https://preview.redd.it/u-s-home-ownership-rates-by-age-v0-odsb38uhxsqa1.png?width=640&crop=smart&auto=webp&s=e44acc7d70a3752981afe0446b5b106e07cc8048
So this sort of but not quite gets at the issue identified in a comment above - we don't have historical context for Kevin's chart.
Still, I think this is enough for me to say this chart actually supports that there is a housing crisis, not that Kevin's blinders are correct.
I know others have made this point already, but my goodness, this is embarrassing.
"Higher than it's ever been anytime in the last 30 years" except for half of the last 30 years.
Why not just say average? The chart makes the current home ownership rate look very average!
When I try and reconcile this chart, with the popular discourse, I speculate the following. Lots of younger folks in certain states (often lower cost red states ) can afford a home and purchase. In contrast, many younger people in major blue cities (NYC, Boston, San Francisco, Los Angeles etc) struggle to purchase real estate.
The media is concentrated in blue cities. So, while the average may look okay, most younger people say, good luck buying in San Francisco etc.
It's really a problem on the coasts and in a few trendy cities like Austin, TX or Denver, CO. You can still get a beautiful 3-4 bedroom home in Rochester, NY for like $250,000. Sure, winters are hard, but getting less hard these days. And besides, I'd take a beautiful upstate NY winter any day over a Houston summer.
Ah yes, the old "it's all the young media writers in the coastal cities that are driving the narrative" trope.
I live in an area where a lot of the housing stock dates to the 50-60's when everyone supposedly lived the American dream in their own home with a lawn and white picket fence and they all have one notable feature: they're really small. Like 1000-1500q ft at the most. Few have garages. The only new houses getting build today are luxury condos or 3000+ sq ft. McMansions that are out of reach of most middle income earners. That's due to a number of factors, from out-of-date zoning rules to NIMBYism to the reluctance of banks to underwrite smaller mortgages for lower-income people. It would also help to revive the 203k renovation mortgage program to encourage people to purchase older homes that need fixing up. We looked into that a few years ago and found there was not a single lender we could find that participated.
Many posters allude to this, but I don't know why Kevin doesn't address, straight on, the interesting "American" concept of "each generation does better than the prior generation."
It was both an "article of faith" and "pretty much true" for like the first 175 years of the country's existence, due to the almost free land which did not exist in Europe, where most of the country came from. Even now, all the immigrants Trump loves to bash are certainly living the "American dream" because their lives here are (1) better than where they came from and (2) their children's lives can be better still.
But as long as "better" is described as a better house (bigger, nicer, etc) there is no way that this latest generation is getting houses better than those of their parents.
That's the zeitgeist, not raw numbers of how many 30 years olds own houses.
And it should make for a fairly easy chart, by Kevin's high standards. 🙂
I’m not sure if the data is available, but I think it would be interesting to see what the home ownership rate is for this cohort between college and non-college educated people For all generations
I think the size of the college-educated cohort has grown substantially so we have certain expectations that are fundamentally class, but that are coded as education-based.
Hmm. Not so sure in the age range 25-29 it is going to show what you are suggesting. If you consider that many people going to college take on debt they probably don't realize a better financial position until 30+. Especially for the people that get advanced degrees.