Economic Center Blog

Are Home Builders Closing The Gap Between Housing Supply And Demand?

By Mark Fleming on July 19, 2018

Yesterday’s Census Bureau report on housing construction bodes well for home buyers, as the pace of housing completions increased 2.2 percent over last year. The continued year-over-year growth in completions means more homes on the market in the short-term, offering some immediate relief in alleviating housing supply shortages.

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Topics: Housing, Homeownership Progress Index, housing starts, Insider

Potential Homeownership Demand Unfazed By Rising Rates

By Mark Fleming on July 9, 2018

As we reflect on our country’s recent Independence Day commemoration, we find that the desire to achieve the American dream of homeownership still exists. Because, while the U.S. homeownership rate remains close to half-century lows, demand is strong, especially among millennials. In fact, results of our Real Estate Sentiment Index survey of title agents and real estate professionals conducted in the second quarter of 2018 showed nearly 87 percent of first-time home buyers were in the prime home-buying age of 26 to 35, which corresponds with the ages of millennials.

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Topics: Homeownership Progress Index, Millennials, Insider, Housing

Are Baby Boomers The Key To The Housing Market Shortage?

By Mark Fleming on May 14, 2018

Baby boomers – those born between 1946 and 1964 – have steered economic trends for decades and have the highest rate of homeownership in the country, approximately 80 percent. Now, as the oldest members of the generation edge into their 70s, they are deciding to stay in their homes. According to a Realtor.com housing shortage survey, boomers have the least interest in selling their home. Approximately 85 percent of baby boomers surveyed indicated they are not planning to sell their home in the next year. The main reason, according to the survey, is that their current home meets the needs of their family.

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Topics: Homeownership Progress Index, Insider

The Market Dynamics Fueling The Great Housing Shortage

By Mark Fleming on April 20, 2018

In March, the housing market continued to underperform its potential. Actual existing home sales are 4.5 percent below the market potential for home sales, according to our Potential Home Sales model. The lack of supply is the primary culprit. The inventory of homes for sale in most markets remains historically tight, yet demand continues to rise as millennials further age into homeownership. Limited supply and rising demand means house prices are surging, so why aren’t more existing homeowners selling their homes? Two market dynamics are at play.

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Topics: Interest Rates, Homeownership Progress Index, Insider, Housing

Busting The Myth Of The Millennial Renter Generation

By Mark Fleming on April 13, 2018

It’s a popular myth – the millennial generation is destined to be a generation of renters – avocado toast, anyone? With student loan debt burdens, the scars of the Great Recession, and limited housing supply, the myth is rooted in some real challenges for millennials. However, despite these challenges, millennials are not only interested in homeownership, they are the primary reason that the homeownership rate increased over the past year.

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Topics: Homeownership Progress Index, Millennials, Insider

What Are The Prospects For Future Homeownership Demand?

By Mark Fleming on August 17, 2017

We’ve posted the annual First American Homeownership Progress Index (HPRI), which measures how a variety of lifestyle, societal and economic factors influence homeownership rates over time at national, state and market levels. The HPRI declined 0.4 percent year-over-year, and is down 6 percent from the pre-recession peak. Potential homeownership demand is at the same level it was in 1990.

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Topics: Homeownership Progress Index, Millennials

Do Unexplained Homeownership Gaps Exist?

By Mark Fleming on April 20, 2017

Homeownership is a goal shared among all people, regardless of race or ethnicity, and  remains the main driver of wealth creation for the majority of households in the United States. That is why it is vital to understand the underlying characteristics that influence the probability of homeownership. Over the last several months, my research has explored the influence of marital status and family formation, education, income and economic factors on  homeownership rates. Today, I examine how ethnicity impacts the probability of homeownership.

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Topics: Homeownership Progress Index, Insider, Education

Can You Spring Break Into Homeownership?

By Mark Fleming on March 16, 2017

Spring break is fast approaching, that playful time of year when beach cities are inundated with college students and tourists. As housing economists, spring break is exciting because it coincides with the beginning of the spring home buying season! While we may not seem to have much in common with the college crowd, there is an underlying connection: education.

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Topics: Homeownership Progress Index, Millennials, Insider, Education

Two Trends Poised To Trigger Potential Surge In Homeownership Demand This Spring

By Mark Fleming on March 2, 2017

The spring home-buying season is right around the corner. As we reflect back on the spring of last year, it becomes clear that we were spoiled in 2016 with mortgage rates well below 4 percent at the beginning spring, and flirting with record lows at 3.4 percent in the summer. This year began with mortgage rates at 4.25 percent, and concern mounting that mortgage rates would rise further this spring. Despite the higher mortgage rates, the most recent January existing-home sales numbers increased dramatically, surpassing a recent cyclical high and increasing to the fastest pace in almost a decade. This represents a potential trigger moment in housing. While inventories remain very low, and median home prices are on a 59-month streak of increases on a year-over-year basis (7.1 percent), home sales remain robust. Could the strong home sales signal a pending broad upsurge in the desire for homeownership?

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Topics: Homeownership Progress Index, Income, Insider

Is Love The Answer To Declining Homeownership?

By Mark Fleming on February 13, 2017

For Valentine’s Day, we pondered the question, could more love lead to an increase in homeownership? This is a serious question because marriage and homeownership, perhaps the two most enduring institutions of our society, have shaped the economic fortunes of many Americans.

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Topics: Homeownership Progress Index, Insider, Millennials, Education