Foreclosure crisis increases decline of U.S. home ownership

U.S. home ownership levels have declined to the lowest level in more than a decade. The decline is gaining momentum. Severe unemployment, a wave of foreclosures and plummeting home prices are taking their toll. Foreclosures have mounted by the millions in recent years and millions more will go down before the crisis is over. Article source – U.S. home ownership rates falling as foreclosure crisis deepens by Personal Money Store.

There are not as many owning their homes

Home ownership in the U.S. has declined continuously over the last five years based on a record from the United States of America Census Bureau. U.S. home ownership has dropped by 3 million households since 2005. 66.9 percent owned homes in the third quarter of this year. Since 1999, the rate hasn't been that bad. The home ownership rate peaked in the first quarter of 2005 at 69.1 percent. Right now, there’s a bunch of economic uncertainty. This has made it harder for younger homeowners. There had been a 9 percent decrease since 2005 in those who owned their homes and were under 35. In the 3rd quarter of 2010, it was at 39.2 percent.

The housing sector

As homeownership falls, the housing market follows. U.S. existing home sales in September dropped 19 percent from the year before. The current annual rate of 307,000 existing home sales is a historic low. The lack of sales continues to drive down home prices. Based on the census Bureau, many homes are vacant right now. 18.8 million homes are this way at present. Housing starts in 2010 are at about a 600,000 a year annual rate, far below what is considered normal. A real estate analyst told Cable News Network that fewer people are forming new households or renting. You will find more roommates for younger individuals while families will double up.

The foreclosure crisis together with home ownership

There should be a ton of foreclosures this year. In fact the amount is expected to a million. If unemployment stays this high, there can be more homes foreclosed on. In 2011, the rate could be even higher. Morgan Stanley came out with a record on this. It said that about 3.1 million mortgage holders will probably be foreclosed on as they’re seriously delinquent. An additional 4 million homeowners are falling behind, and half of those are expected to go into foreclosure. Any time could lead to homes being foreclosed. 11 million are currently expected to foreclose.

Citations

CNN

money.cnn.com/2010/11/02/real_estate/homeownership_rate_falls/?iid=MPM

Daily Finance

dailyfinance.com/story/real-estate/u-s-homeownership-stuck-at-lowest-level-since-1999/19699908/

Consumer Affairs

consumeraffairs.com/news04/2010/11/the-american-dream-of-home-ownership-is-in-its-dimmest-period-in-more-than-a-decade.html