Why homeownership dropped for first time in years: Harvard

A long-term rise in the homeownership rate ended last year, and the latest report from the Harvard Joint Center for Housing Studies examines some reasons why.

A widening gap between housing costs and wages contributed to the 30 basis-point drop in the ownership rate year over year to 65.6%, according to Census data. This marks the first decline in eight years if 2020 is omitted based on data collection issues, or since 2021 if the initial year of the pandemic is included.

The shift from a rising homeownership rate to a declining one is the result of a gradual increase in affordability pressures rather than any abrupt change, according to Daniel McCue, senior research associate at the center.

“It’s an inflection point,” he said in an interview about the switch to a declining homeownership…