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Millennials drive homeownership rate increase in Q3

The homeownership rate increased slightly in the third quarter, driven primarily by a jump in first-time homebuyers. This is up slightly from 64.3% in the second quarter and from 63.9% in the third quarter of 2017. “Their homeownership rate is up a whopping 1.2% since Q3 2017 to 36.8%.” Homeownership among those under age 35 increased from 35.6% in the third quarter 2017 and 36.5% in the second quarter this year to 36.8% in the third quarter 2018, the report showed. Meanwhile, those ages 35 to 44 years dropped from 60% in the second quarter to 59.5% in the third quarter. This is also still up from 69.1% in the third quarter of 2017. Those ages 65 years and older saw an increase from 78% in the second quarter to 78.6% in the third quarter this year, however this is down slightly from 78.9% in the third quarter of 2017. That is more than the pace of household formation over the same period, meaning that the transition from renting to own is the more powerful driver of housing demand.” “That has also been an important and often overlooked reason for the rapid rise in home prices, as more buyers came into the market,” Liu said. These events caused the homeownership rate and home sales to diverge this quarter.” The Hispanic homeownership rate saw a quarterly drop as it fell from 46.6% in the second quarter to 46.3% in the third quarter. Among whites, the homeownership rate increased from 72.5% in the third quarter of 2017 and 72.9% in the second quarter this year to 73.1% in the third quarter of 2018. Blacks also saw an increase from last quarter, rising from 41.6% to 41.7%, however the rate dropped from last year’s 42%.