The Rise in Homeownership

by | Aug 11, 2020 | Housing Market | 0 comments

Despite a slowdown in the housing market at the onset of the pandemic, there was an increase in homeownership rates in the second quarter of 2020.

From the way the industry is moving now that we are in quarter three, it appears that homeownership rates will remain high. In June 2020, there were 4,263 pending sales, more than ever recorded by the MLS. In July, that record was broken with 5,056 single-family pending sales in the state.

The rate of homeownership rose to 67.9% in Q2, an increase from 65.3% in Q1, according to a Census Bureau report. This marked the fourth straight increase and the highest jump since 2008. 

Millennials are leading the way, with a homeownership rate for buyers under the age of 35 rising to 40.6%. This is the highest rate of young buyers in almost 12 years. We expect to see more of the younger generation become homeowners this year as well. Of the millennials planning on buying a home in the next year, 57% are already actively searching, according to a Housing Trends Report by NAHB. 

Factors Leading to an Increase in Homeownership

There are numerous reasons why the housing market remains strong in 2020. The pandemic has made people evaluate their living situations, and coupled with low mortgage rates, many are finding now is the time to buy. 

“Mortgage rates are the icing on the cake for households that were thinking about buying,” said Ralph McLaughlin, chief economist for Haus, a co-investment platform for homebuyers. “They found an unexpected opportunity during the worst economic downturn America has seen since the Great Depression.”

Industry experts expect that the trend of low mortgage rates and a strong housing market will continue for the remainder of 2020.