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The state of homeownership in Houston

by James McClister

homeownership-rate-race-age-affordabilityapartment-listing-

The homeownership rate is a tabulation of households that are owners; and in Houston, the share of people who own their homes is lower than it was in 2007 – significantly lower.

A report from Apartment Listing put Houston’s current homeownership rate at 59.2 percent. That is down 5.3 percentage points from the city’s 2007 rate, and about 5 percent below the nation’s average 2016 rate of 63.4 percent – which represents a 48-year low for the country.

 Year Avg. Houston
2007-2016 Change -5.3%
2016 59.2%
2015 60.3%
2014 60.4%
2013 60.6%
2012 62.2%
2011 61.3%
2010 61.4%
2009 63.6%
2008 64.8%
2007 64.5%

There are two big trends defining the city’s decline.

1. An age problem

Houston rebounded quickly from the downturn. In a state where foreclosures can be completed without a presiding judge, the city, propelled by booming energy and healthcare sectors, moved through the glut quickly. However, while skyrocketing home price appreciation told the story of a healing market, other forces – such as stagnating wages, debt and dwindling affordability – pushed homeownership out of reach for many. Across all age groups, the homeownership rate in Houston fell from 2007 to 2014 (the latest year data is available), Apartment Listing confirmed. But the declines were steepest among Millennials (7.6 percentage points) and 35 to 44 year olds (7.3 percentage points). The future of Houston’s housing market hinges on those age groups purchasing homes.

Houston 18-34 35-44 45-54 55-64 65+
2014 30.2% 55.1% 66.4% 73.6% 77.5%
2013 30.5% 56.7% 68.7% 75.1% 78.5%
2012 31.4% 57.1% 69.7% 76.8% 80.4%
2011 33.7% 57.6% 70.3% 77.2% 78.5%
2010 34.8% 61.4% 71.3% 76.5% 80%
2009 35.5% 60.3% 71.5% 77.4% 79.5%
2008 37.1% 62% 72.7% 77% 78.3%
2007 37.8% 62.4% 72.9% 78.8% 79.3%
2007-2014 Change -7.60% -7.30% -6.60% -5.20% -1.80%

2. A race problem

Houston homeownership rates have also declined along racial lines. The report showed that decreases were disproportionate among groups, as are the most current rates. Seventy-one percent of non-Hispanic white residents in the city were homeowners in 2014, as were 66 percent of Asian residents, after falling 3.7 and 3.6 percentage points from 2007, respectively. Over the seven-year period Apartment Listing tracked, Hispanic homeownership fell 3.9 percentage points to 50 percent in the city, while African American homeownership dropped 4.7 percentage points to 42 percent.

Those rates still compare favorably to national rates during the same year, in which 41.7 percent of African American households and 45.7 percent of Hispanics were homeowners, but mark a disturbing trend in minority homeownership – especially considering the local gains in African American and Hispanic residents. Houston’s Mayor Turner has pushed for more affordable and low income housing to satisfy demand in the lower price points, but so far implementation of his plans have been stalled.

Houston African American Asian Hispanic Non-Hispanic White
2014 42% 66% 50% 71%
2013 42% 68% 52% 71%
2012 42% 65% 53% 73%
2011 45% 68% 52% 73%
2010 47% 67% 55% 73%
2009 45% 66% 53% 73%
2008 46% 70% 54% 74%
2007 47% 70% 54% 75%
2007-2014 Change -4.7% -3.6% -3.9% -3.7%

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