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Home Ownership Decreases Nationwide, Most Prominent Within African American Community

It turns out home ownership across the nation is in a decline.

A Pew Research Center analyzed the rates of home ownership throughout the country and determined that the current levels are at their lowest in over 20 years.

This decline has primarily affected Millennials, African Americans, and lower-income families. Rates of home ownerships by those under 65 have been the lowest in the history of the U.S. Census Bureau.

Currently, 63.5% of Americans own their own home, which is down from its peak of 69%, in 2004. But of this percentage, only 41.3% of black families are homeowners. Many experts are puzzled at this trend, since the housing crisis of the late 2000s is recovering at a steady pace.

So what is going on?

Turns out more Americans are choosing to rent rather than own their homes. The Pew Research center reports that while 72% of renters would ideally like to own a home one day, there are plenty of roadblocks in the housing market that are causing home ownership to be virtually impossible.

For example, lending standards are much more stringent nowadays than they were 15 years ago. Back in 2001-2003, federal banks defined reasonable lending standards at an index level of 12.5%; the current rate stands at just over 5%.

Tightening credit standards are also to blame. This is a pattern that is witnessed mostly by African Americans and Hispanics, as federal money set aside to assist these demographics has all but dried up.va-home

Not to mention that these financial problems don’t go away once someone owns a home. In a median priced home that costs around $186,000, the American Housing survey has determined that owning a home costs each homeowner around $1,450 a month, or almost $18,000 a year. This is even before any home renovations or repairs, which means for the 40% of homeowners who plan to spruce up their home, they’re in for quite the sticker-shock.

So for now, most Americans are staying in their rental homes.

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