Home ownership in the United States has hit a 19-year low as tight finances continue to drive Americans toward renting, one of the lasting legacies of the recession. The seasonally adjusted home ownership rate fell to 64.8 percent in the second quarter ended June 30, the lowest level since the same quarter of 1995, the Commerce Department said on Tuesday. That compared to 65.0 percent in the first three months of 2014 and 65.1 percent a year ago. Economists said home ownership, which peaked at 69.4 percent in 2004, could fall even further as banks maintain stringent lending practices and wage growth remains tepid, despite an acceleration in job creation. "We are becoming more of a rental society. It's becoming harder to own a home," said Patrick Newport, an economist at IHS Global Insight in Lexington, Massachusetts. The 2007-2009 recession, sparked by the collapse of the U.S. housing market, has left the economy with deep scars that will take long to heal. Wage growth remains lackluster, even though the unemployment rate is at six-year lows and the economy has recouped all the jobs lost during the downturn.
First published July 29 2014, 11:28 AM