The U.S. homeownership rate fell
to the lowest level since 1998 in the second quarter as stricter
lending standards blocked purchases and foreclosures forced
people out of their residences.
The ownership rate through June was 65.9 percent, the
lowest since the same rate 13 years ago, the U.S. Census Bureau
said in a report today. The vacancy rate, the share of
properties empty and for sale, was 2.5 percent, compared with
2.6 percent in the first quarter.
The strictest mortgage standards in more than a decade are
disqualifying potential buyers while owners are being evicted
from homes after falling behind on loan payments, said Wayne
Yamano, director of research at John Burns Real Estate
Consulting in Irvine, California. Home purchases fell in June to
a 4.77 million annual pace, the National Association of Realtors
said July 20. If housing demand remains at that level, 2011
would have the fewest sales since 1997.
â€œTight underwriting standards and the lack of a down
payment are keeping a big chunk of buyers out of the market and
other people are being displaced by foreclosures,â€ Yamano said
in an interview before the report. The ownership rate may tumble
to about 62 percent by 2015, he said.
Conflicting data on sales and prices show the housing
market that sparked the global recession continues to struggle.
The number of contracts to purchase previously owned U.S. homes
rose 2.4 percent in June, the Chicago-based Realtorsâ€™ group
reported yesterday. Together with an 8.2 percent gain in the
prior month, the index has almost erased an 11 percent plunge in
Also in June, sales of new U.S. homes reached a three-month
low of 312,000 at an annual pace, the Commerce Department said
July 26. Prices in 20 cities dropped 4.5 percent in the year
ended May, the most since November 2009, according to a report
issued the same day by S&P/Case-Shiller.
The homeownership rate declined from 66.4 percent in the
first quarter. It reached a record high of 69.2 percent in the
second and fourth quarters of 2004, a time when President George
W. Bush promoted an â€œownership societyâ€ to rally support for
expanding mortgage financing to more Americans.
There were 18.7 million vacant homes in the second quarter,
including foreclosures, residences for sale and vacation homes,
compared with 18.9 million a year earlier, according to todayâ€™s
Census Bureau report from Washington.
About 2 million of those empty homes were for sale, almost
matching the number a year ago, according to the report. That
may mean half of the 3.8 million homes for sale in June were
vacant, though the Realtorsâ€™ group that reports inventory
doesnâ€™t track properties sold without a broker. When banks get
rid of repossessed homes, they sometimes donâ€™t use real estate
-- Editors: Christine Maurus, Andrew Blackman
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