Nation's home ownership lowest in a decade
Realty signs hang in front of homes for sale in a housing development Monday, Oct. 25, 2010, in Phoenix. Sales of previously occupied homes rose last month after the worst summer for the housing market in more than a decade. (AP Photo/Ross D. Franklin) Credit: AP Photo/Ross D. Franklin
WASHINGTON - The nation's home ownership rate remained at its lowest in more than a decade, hampered by a rise in foreclosures and weak demand for housing.
The percentage of households that owned their homes was unchanged at 66.9 percent in the July-September quarter, the Census Bureau said Tuesday. That's the same as the April-June quarter. The last time the rate was lower - 66.7 percent - was in 1999.
For decades, 64 percent of American homes were owned by their occupants. That began to climb in 1995, with strong encouragement from President Bill Clinton and later on from President George W. Bush.
Democrats, including Rep. Barney Frank (D-Mass.), pushed for mortgage buyers Fannie Mae and Freddie Mac to purchase more loans targeted toward low-income Americans. Republicans encouraged subprime lending to borrowers with weak credit and fought off regulation of the industry, despite warnings that many of the loans had predatory terms.
Home ownership hit a peak of more than 69 percent in 2004 at the height of the housing boom. But the housing bubble burst in 2006, and the rate has been declining gradually since then.
"They just assumed: The more home ownership the better," said Dean Baker, co-director of the Center for Economic and Policy Research, a liberal Washington think-tank.
A record number of foreclosures and tight lending standards are expected to keep pushing the ownership rate down, and it will eventually return to pre-1995 levels, said IHS Global Insight economist Patrick Newport.
The housing troubles have brought the government's role in promoting home ownership into question.
"The consensus is, in a lot of cases, it just makes sense for a lot of people to rent," Newport said.
