Trends in Home-Ownership in the U.S.

Goals

To provide an overview of the recent trends and attitudes in home-ownership in the U.S., including: how “safe” home-ownership is currently perceived in light of the challenges caused by the COVID-19 pandemic, such as unemployment; whether renting will become more preferred in 2021, as opposed to home-ownership; the difference in attitudes towards home ownership for different markets (urban, suburban, rural), generations, and ethnicities; the audiences that are most likely to buy new homes in 2021, and why. Only data/information from 2017 should be used. This information will be used to inform a new business pitch around a Super Bowl ad campaign for Rocket Homes / Rocket Mortgage (under Quicken Loans).

Early Findings

Overview on Home-ownership in the U.S.

  • The national home-ownership rate in the U.S. was 65.3% in the first quarter of 2020, 1.1 percentage points higher than the rate in the first quarter of 2019 (64.2%), but was only slightly higher than the rate in the fourth quarter of 2019 at 65.1%.
  • Between 2016 and 2019, the percentage of non-Hispanic white Americans who own homes has been consistently above 71%, with that of African Americans being just above 41%, above 45% for Hispanic Americans, and above 53% for Asian Americans.
  • Prices in the rental housing market are likely to remain stable, post COVID-19. This is based on the fact that the average rent fell by only 0.2% from April to May, although 20 million people lost their jobs in April.
  • Overall, demand from higher-income households for rental housing is on the rise.

Insights on Different Audience Perspectives in Home-ownership in the U.S.

  • There is expected to be increased interest by investors looking to buy a home and hold onto it in the long term, particularly as a rental property. "According to a recent survey from Auction.com, 64% of investors who primarily buy investment properties as rentals said they planned to increase or keep their acquisitions, despite the COVID-19 pandemic."
  • The competition by investors for foreclosure homes, due to moratorium on foreclosures, could drive up the prices in the distressed housing market.
  • Generation Xers are much more likely to remain in the rental market for a longer period than prior generations at that age, as they were the most affected by the 2008/9 recession.
  • The aging of the millennial generation should support robust demand for both rental units and starter homes. Millennials account for a third of all new home-buyers and nearly half of all mortgages.
  • Millennials are said to have a preference for walk-able communities (as opposed to, say, single-family units in the suburbs). Due to these kinds of set preferences, it is expected that "homes that meet Millennial’s ideals and their budgets will continue to appreciate at double-digit rates" in the future.

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