Bill McBride and Tom Lawler are still digging through the Census data on homeownership and vacancy
If 2010 headship rates and homeownership rates for each age group had been the same as in 1990, the US homeownership rate would have been 66.7% instead of 65.1%. If 2010 headship rates and homeownership rates had been the same as in 2000, the US homeownership rate would have been 67.3%!
In fact, the aggregate data suggest that in 2010 the homeownership for most age groups was probably below 1990 rates!!!
Last week’s report, then, was clearly the BIGGEST STORY ON US HOMEOWNERSHIP in many, many years.
. . .
CR Note: This indicates that the age adjusted homeownership rate has fallen below the 1990 homeownership rate. All my previous analysis was based on the HVS data, and now that Census 2010 data has been released, the previous analysis is unfortunately incorrect (I need to think about the implications)
My baseline remains that the overbuild in housing was mild. The rise in vacancies appears to be driven in large part by a collapse in homeownership and seemingly a strong rise in household size. Kids still living with their parents. More older singles sharing places.
However, these trends are not likely to reverse themselves strongly as the recession eases.
It also means that we should expect increases in core inflation in the near term.