HOME OWNERSHIP STATISTICS
Owning a home used to be a right of passage in attaining the so-called American dream. Many still consider it to be, but homeownership requires a lot more energy and money than it did in the past. Buying is a smart choice for many people, but it isn’t always the best deal. Factors such as the market where you live, how long you plan to stay in your home, and the size of the home you want to purchase compared to where you’re renting, among other things, are all items to consider before becoming a homeowner. It’s important to understand the benefits and drawbacks of buying
versus renting before you come to a conclusion. The statistics below are intended to help those who are considering homeownership.
Home Owning Generational Trends
- In 2019, Millennials made up the largest share of home buyers at 37 percent. Older Millennials (29-38 years old) made up 26 percent and Younger Millennials (21-28 years old) made up 11 percent of the share of home buyers. 86 percent of the Younger Millennials and 52 percent of the Older Millennials were first-time home buyers, more than any other age groups.
- Buyers 73 to 93 (The Silent Generation) represented the smallest share of buyers at seven percent in 2019. Most of these buyers were likely to have retired or scaled back their work demands and therefore had the lowest median household incomes.
- In 2019, GenXers (39-53 years old) purchased the largest homes in size at a median of 2,100 square feet. GenXers consisted of 24% of recent home buyers that year.
- Adults in their mid-30s to mid-40s are three times more likely to rent than 20 years ago. Many are forced to live and raise families in insecure privately rented properties.
- By 2025, Millennials are expected to form more than 20 million new households.
Factors Considered in Homeownership
- 74% of younger millennials prefer new homes because they don’t have to renovate or think about bad plumbing. However, since this is the age group that is also the least-likely to have any savings, they are more than willing to go with the cheaper options.
- Reducing commuting costs is one of the most important factors for 40% of millennials. People prioritize proximity to their workplaces when considering homeownership.
- Despite 60% of first-time buyers claiming living close to family is important, the reality is very different. A 2020 study found that over three quarters (77%) of first-time buyers don’t buy in the same area as their parents.
- Almost one in three respondents (29%) to a Zoopla survey of first-time buyers and existing homeowners chose a parking space as their most desirable feature for their first home. To many, being able to park at home is just as important as the home itself.
- When choosing an area to buy a home, respondents were found to highly value access to transport (85%), supermarkets (80%) and proximity to work (78%).
- Neighborhood quality is the key factor for 58% of home buyers. Whether you have kids or not, the quality of schools in a neighborhood is important to note.
- Finding the right location was also among the biggest challenges for first-time buyers, with 16% saying they struggled to find potential homes in the area they wanted.
Homeowner Statistics by Race, Ethnicity, and Country
- In the first quarter of 2020, 73.4% of Non-Hispanic White Alones were homeowners. This was the highest of any race.
- 44% of Black Alones were homeowners in the first quarter of 2020. This was the lowest of any race.
- 48.9% of Hispanics were homeowners in the first quarter of 2020. This homeownership rate for Hispanic householders was higher than the first quarter 2019 rate.
- In the first quarter of 2020, 59.1% of Asian, Native Hawaiian and Pacific Islanders were homeowners.
- In 2019, 85% of homebuyers identified themselves as caucasian. Hispanic/Latinos were second highest with 6%.
- 63% of households in England owned their own homes in the 2 years from 2016 to 2018. This equates to approximately 14.6 million households.
- Around two-thirds (66%) of Australian households owned their home in 2017-2018 – either with or without a mortgage. It’s actually Australia’s lowest rate of homeownership since the survey began in 1994.
- 68% of White British households own their own homes, compared with 74% of Indian households.
- The black homeownership rate has been continuously lower than all groups and has dropped further than other groups since 2000. Research revealed the significant influence parental homeownership and wealth has on homeownership, an important factor that accelerates this widening gap.
- 79.4 percent of non-Hispanic home buyers have conventional financing, compared to 57.2 percent of Hispanics. These differences mean Hispanics are more likely to pay mortgage insurance premiums (MIP) for the life of their FHA mortgage, thereby increasing overall monthly out-of-pocket expenses.
Student Loans Delaying Home Purchase
- Real estate statistics show that 24% of home buyers still have student loan debt. For buyers 29 to 38 years, 42% had student debt with a median amount of $30,000 compared to just 4% for buyers 64 to 72 years. Buyers aged 39 to 53 also had the highest amount of debt at $30,000.
- Student loans represent $1.7 trillion in debt, negatively impacting the ability of younger, college-educated adults to buy homes.
- A study found that a 1% increase in education loan debt decreases the likelihood of owning a home by 0.15 percentage points. In other words, if a person’s household student debt increases 100 percent from $50,000 to $100,000, with all other things held the same, the likelihood of owning a home will decrease 15 percentage points.
Home Owning Process
- Help understanding the purchase process was most beneficial to buyers 28 years and younger at 87% and for buyers 29 to 38 years at 72% in 2019. Homeownership is not a simple task.
- On average, a homebuyer can spend a few days to go through the initial pre-approval process, anywhere from a few weeks to a few months shopping for the right home, and 30 to 45 days to close the deal.
- Doing the paperwork was the number one problem for 20% of home buyers in 2019. This was second only to finding the right property.
- In 2019, paperwork and understanding the process and steps was more difficult for Millennials 28 and younger than any other Generation. Older generations could’ve been through the process previously, which might explain the discrepancy in generations.
- In 2019, 44% of people’s first steps of the home buying process was looking online at properties for sale.
- Data from HomeLight shows there are over 2 million active real estate agents in the U.S. According to data from NAR, 1,359,208 of those licensed agents are Realtors. Real estate agents aren’t always Realtors.
- By state, California has the most registered Realtors in the country, with 194,572 active in 2017. Florida ranks a close second with 173,482.
- 67% of realtors are women. However, among members who are over 60 years old, this percentage falls to 62 percent.
- In 2019, 20% of real estate agents used social media to market their homes. This number should rise in the coming years due to social media’s massive reach.
- 63% of home sellers in 2019 used a referral or the same real estate agent they had worked with in the past. That number jumped to 68% for home sellers aged 29 to 38 years.
Home Ownership Rates
- The highest homeownership rate is in the Midwest at 2% in the first quarter of 2019. The Midwest is followed by the South (66.2%), the Northeast (60.7%) and the West (59.8%), although all four regions were slightly down from the last quarter of 2018.
- Homeownership rates in the US have steadily risen since September 2016, coming in at 3% in January 2020.
Home Sales Statistics
- Sales of new single‐family houses in June 2019 were at a seasonally adjusted annual rate of 646,000, a gain of 7% from May’s adjusted rate of 604,000 and 4.5% ahead of June, 2018, according to estimates released by the U.S. Census Bureau and the Department of Housing and Urban Development.
- New home sales increased by 5% year on year. New home sales have not been severely impacted by the supply problems that have plagued the market for previously owned homes.
- 701,000 new houses were sold in September of 2019.
- In 2019, 35% of residential properties sold for between 95% and 99% of their listed price. Home prices are on the rise, most likely due to increased pressure on inventory.
- National home sales increased steadily month over month in 2019, starting from 555,000 homes sold in December 2018 to 690,000 homes sold in March 2019.
- June is, on average, the month when homes sell the fastest in the US. Homes sold in the U.S. during the second week of June typically stayed on the market for 22 days, the fastest pace since June 2018.
- Dallas, Houston, and Miami are the least competitive housing markets for buyers.
- Fishers, IN and Carmel, IN top the list of best cities for families. Fishers and Carmel both received A+ grades (and the highest weighted scores of over 96 out of 100), making them the best ranked out of 552 cities.
- Madison, WI and Grand Rapids, MI are the two most popular cities for millennials. There has been a considerable shift in young home buyers flocking to areas with affordable living conditions, plentiful job openings, and good wages.
- Affordability is a big issue in Los Angeles County, as nearly three in four residents can’t afford to buy a median-priced home in the area.
- According to HousingWire, an index that combined median income and median home prices made Los Angeles the least affordable city in the country, and a number of younger residents said they were concerned they will never be able to afford a house.
- Home shoppers are leaving Los Angeles for cheaper metros, the most popular being Las Vegas.
Home Ownership Costs
- The average down payment for a new home is $59,880. The median sales price for a newly built home was $299,400 as of September 2019.
- The median down payment for first-time buyers was 6% in 2019, down from 7% in 2018. There are ramifications for putting less than 20% down on your home purchase, however.
- On average, Americans spend 50% of their earnings on buying a home. Half of all renters pay more than 30% of their income on housing.
- 12 million Americans spend more than 50% of their earnings on their home purchase.
- In 2018, the home prices in Los Angeles reached record heights, climbing to levels far above those recorded in the years leading up to the Great Recession. Analysts suggest that home values in Los Angeles will continue to rise, but at a significantly slower rate than the nationwide average.
- Data gathered by the California Association of Realtors in 2019 suggests that single family homes in particular are fetching far lower prices now than they were during the summer, when Los Angeles real estate values reached an all-time high.
Median Home Price
- The median list price for homes in Los Angeles is $940,000. Los Angeles has one of the highest median list prices in the United States.
- The Boston metro area continues to lead the nation as one of the hottest real estate markets with a median list price of over $631,000 and a median days-on-market of 3. The Boston area has seen their average listing price change year-over-year. For example, January 2020 changed by 4% year-over-year.
- The median rent price in the United States is $1,650.
- As of February 2019, the median home value in the United States is $226,300. As we enter the 2020s, the demand for rentals is projected to fall as many millennials move on to homeownership.
- The median price of sold homes in the Denver housing market is $465,000. Homes are selling for approximately $375 per square foot.
- In 2009, there were more home foreclosures in the United States than there were marriages.
- 69% of home buyers are not interested in purchasing a home in foreclosure. Buyers aged 28 and younger were most likely to consider buying a home in foreclosure.
- Nationwide one in every 2,841 housing units had a foreclosure filing in February 2020. States with the highest foreclosure rates were New Jersey (one in every 1,457 housing units with a foreclosure filing); Illinois (one in every 1,507 housing units); and Delaware (one in every 1,628 housing units).
A home is an investment that comes with many investment benefits. Homeownership also comes with many risks, which means it’s not for everyone. Renting and buying each come with significant advantages and drawbacks, and it’s crucial to weigh them both before you come to a decision. If you’re looking for flexibility, low move-in costs, and little to no responsibility for upkeep, repairs, and maintenance, renting may be for you. However, if you’re interested in building equity and investing in your future while having complete control over the home you own, then it’s time for homeownership. These statistics are intended to provide valuable insights to future home buyers.