Four Reasons Why Homeownership Rates Matter

July 29, 2016 at 8:57 am Leave a comment

imagesA dramatic realignment in housing is taking place in this country that has direct and immediate consequences  for lenders.  The Commerce Department reported yesterday that the home ownership rate dropped again this quarter to 62.9.  To put this in perspective, in the third quarter of 2006 69 percent of Americans owned a home, a historic high.

In many ways the numbers are even more dramatic for minorities. The home ownership rate for black Americans was 41.7% while the rate for whites was 71.5. In the third quarter of 2006 the black ownership rate was 48% and the white ownership rate was 76%

If you want to get a house bad enough move west but don’t go too far. The Commerce Department reports that in the second quarter  homeownership rates were highest in the Midwest at 67.7 percent and lowest in the Northeast (59.2 percent) and West (57.9 percent).

Why are these numbers important to know?

  1. Because policymakers have not been honest with the American public. There were and are  banking abuses over the last two decades that need to be addressed. But you can’t toughen underwriting standards without seeing a decrease in homeownership-a decrease that will have a disproportionate  impact on poorer minority groups.
  2. Because we might be starting to see  a dramatic generational paradigm shift. Maybe Millennials don’t view homeownership as an essential part of the American Dream. Personally, I think it’s too early to tell but something is going on here.
  3. Because the statistics provide another example of why, for many Americans, the recovery from the Great Recession has been a recovery in name only. Is there any wonder why an increasing number of people don’t feel like the system has worked for them?
  4. Because Believe  it or not one of the most important public policy issues the country is facing is what to do about Fannie and Freddie. It is a metaphor for a larger discussion about how much the country should subsidize housing as a birth right.

Enjoy your weekend .

Entry filed under: General, Mortgage Lending. Tags: .

CU’s Not Covered By Bureau’s Debt Collection Proposals…Yet TRID Clarifications Proposed

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

Trackback this post  |  Subscribe to the comments via RSS Feed

Authored By:

Henry Meier, Esq., General Counsel, New York Credit Union Association.

The views Henry expresses are Henry’s alone and do not necessarily reflect the views of the Association.

Enter your email address to subscribe to this blog and receive notifications of new posts by email.

Join 503 other followers