Why Home Ownership Rates are Likely to Decline into the Future

For decades now, owning a home in the United States has been encouraged at many different levels and in a variety of ways. From programs that help first-time buyers put together down payments to income tax deductions that generously subsidize ownership, American home owners have received a good deal of support. In recent years, however, signs have emerged that what was once a steadily rising trend toward ownership has begun to soften. For quite a few different reasons, as detailed by Jon Shechtman here, Americans are becoming less likely than before to even think about buying their own homes.

Some of these factors are of relatively predictable, well known kinds. While lending activity has loosened up quite a bit, for instance, it is still quite a bit more difficult for many would-be buyers to obtain mortgages today than it was during the height of the last housing boom. In other words, some portion of the softening that analysts have observed reflects not a real deviation from the long-term trend but a natural correction of the excessive exuberance that led to the last real estate crash.

Beyond that, however, lie plenty of other reasons to believe that there is actually something more significant going on. Real and perceived job security for many Americans has plummeted over the past few decades, for instance, and not being able to work can certainly make it much more difficult to stay on top of a mortgage, as compared to rent. Even more of an issue for many Americans today is that a home can keep a family tied down to an area where the local economy might have stumbled upon troubled times, when more opportunity could be awaiting elsewhere.

Add to concerns like these the fact that members of the Millennial generation are less likely to get married early in adulthood and often take longer to become established in their careers, and many believe that home ownership rates are going to decline significantly before all is said and done. While that might be troubling for some to contemplate, experts also highlight a number of benefits that could potentially accompany this development, including increased mobility and investment into more productive opportunities.