According to figures released by the U.S. Census Bureau, the recent housing woes ravaging the nation have led to a record annual decline in the rate of homeownership.
The Census Bureau report released today revealed that homeowners accounted for 67.8 percent of occupied homes in the fourth quarter, a 1.1 percent decline from a year earlier, and a substantial drop from the 68.2 percent rate during the third quarter of 2007.
That marked the largest year-over-year plunge since the report was created in 1965, and the lowest rate of homeownership since the first quarter of 2002.
During the fourth quarter, homeownership was 71.7 percent in the Midwest, 70 percent in the South, 64.6 percent in the Northeast, and just 62.7 percent in the West.
The homeownership rate hit a record high of 69.2 percent in the second and fourth quarters of 2004 when ultra-low mortgage rates and a wide range of loan programs spurred a refinance and buying frenzy.
Unfortunately, it was subprime lending that pushed homeownership to levels that weren’t sustainable, falsely inflating home prices while creating the need for exotic loan programs to reduce costly monthly mortgage payments.
But now the nation faces slumping property prices, an oversupply of housing inventory, and a lack of willing buyers waiting on the sidelines until things hit bottom.
The homeownership rate in the fourth quarter was more than 80 percent for those aged 55 and older, and just 41 percent for those under 35 years of age.