Geography of Homeownership and Home Building


A majority of single-family home building occurs in counties that are in the lowest quintile of homeownership rates, according to NAHB analysis of 2021 5-year American Community Survey (ACS) county-level data and single-family permit numbers. This somewhat counterintuitive result is actually a reflection of the concentration of households in a small number of counties. For this analysis, counties were grouped into quintiles by homeownership rate. The lowest group, the 20th percentile, had homeownership rates less than or equal to 66.53%. The next or fourth quintile was grouped as having a homeownership rate greater than 66.53% but less than or equal to the 40th percentile of 71.79%. The third quintile ranged from a rate greater than 71.79% to less than or equal to 75.56% while the second quintile was greater than 75.56% but less than or equal to 79.22%. The first quintile was any county with a homeownership rate greater than 79.22%.Before looking at permit data based on these quintiles, it should be noted that approximately 177 million people live in counties in the lowest quintile. As previous NAHB analysis has shown, population density helps to explain a substantial amount of the variation in homeownership rates across counties in the U.S. The 100 smallest counties by population have an average homeownership rate of 72.72%, while the 100 largest counties by population have an average homeownership rate of 59.96%. NAHBs quarterly Home Building Geography Index (HBGI) data shows that on average 53% of all single-family building occurs in large metro areas, where homeownership rates are typically lower. Rural areas in the HBGI, where homeownership rates tend to be higher, make up a much smaller portion of home building. Aggregating each county’s single-family permits into these quintiles, the data shows that the four-quarter moving average market share for the lowest quintile had a market share of 39.62% in the second quarter of 2023, the lowest market share dating back to the fourth quarter of 2017 when it was 44.38%. The lowest quintile market share has averaged 42.47% over the almost six-year period and has consistently made up the bulk of single-family building. The fifth quintile’s loss in single-family building market share started with the onset of the pandemic. The average market share prior to, and including the first quarter of 2020, was 44.19%. This average fell to 41.51% over several quarters following the first quarter of 2020. Over the same period, the largest growth in market share was for the third quintile, which saw its market share grow from 14.13% to 16.65%, a 2.52 percentage point increase. The second quintile gained the second most market share between the end of 2017 and today, gaining 1.52 percentage points, as it rose from 13.10% to 14.62%. The first quintile had the third largest growth in market share, rising 1.16 percentage points from 9.87% to 11.02%. The fourth quintile fell 0.43 percentage points from 18.52% to 18.08%, the only other quintile to lose market share over this period. With over half of the population living in relatively lower homeownership areas, single-family home building is correspondingly concentrated in places with a larger number of households. Counties with the highest homeownership rates make up the smallest share of single-family construction. An additional finding of the analysis involves the impact the pandemic had on the geography of housing: namely the changes in the market share of home building relative to homeownership. While home preferences are constantly changing, it is evident that the pandemic shifted the single-family market somewhat away from high density areas as individuals moved further away from urban cores into the suburbs where homeownership rates are higher. Single-family building followed these movements as the market share for the lowest homeownership counties fell below 40% in the second quarter of 2023. Related ‹ More Women Working in Construction in 2022Tags: HBGI Featured Topic, HGBI, homeownership, homeownership by county, single-family

Geography of Homeownership and Home Building2023-09-12T08:25:57-05:00

Homeownership across US Counties


While US homeownership rates have been rising since 2015 and received an extra boost during the post-pandemic housing boom, they remain below the levels reached during the housing boom of the mid-2000s. With the national trends reflecting fundamental drivers of homeowners, local markets often tell different and unique stories. NAHB’s analysis of the 2021 5-year ACS county-level data reveals substantial variation in homeownership rates across US counties, ranging from less than 25% in urban counties of New York to over 90% in exurban counties of Denver and in the South. The geospatial analysis of cross-county variation in homeownership rates reveals a familiar geographic pattern with high cost of living coastal areas registering some of the lowest homeownership rates. Within California, for example, homeownership rates in coastal Monterey and Santa Barbara are below 53%. At the same time, homeownership rates in High Sierra counties of California approach and exceed 80% (Alpine, Calaveras, Sierra, Amador, El Dorado). Population density also helps explain substantial variation in homeownership rates across US counties. Urban high-density counties register some of the lowest rates. Four core urban counties in the New York metro area appear in the bottom ten homeownership rate list – Bronx (19.8%), New York County (24.7%), Kings County (30.7%), Hudson County (32.3%). In California, the lowest homeownership rates are in San Francisco County (38.2%) and Los Angeles County (46.2%). In the Washington DC metro area, the three core central counties register homeownership rates below 43% – District of Columbia (41.5%), Arlington County (42.3%), Alexandria city (42.9%). At the same time, its outlying Madison and Calvert Counties show homeownership rates of 82.4% and 85.3%, respectively. Counties on the top ten list register homeownership rates in excess of 90%. The list includes four counties in the Mountain division. Two are in the Denver metro area – Elbert County (92.6%) and Park County (91.1%) – as well as Storey County, NV (96.5%), Meagher County, MT (92.1%). Out of the remaining six highest homeownership rate counties, five are in the south (Terrel County, TX, Cameron Parish, LA, Powhatan County, VA, Washington County, AL, Doddridge County, WV). While the counties with highest homeownership rates are spread through out the country, the common feature is that these are all outlying lower density counties. Using NAHB’s Home Building Geography Index (HBGI) delineation confirms that the highest home ownership rates are registered by exurban counties, averaging slightly above 75% for this geographic grouping. High-density core counties in large metro areas register a considerably lower average home ownership rate of about 54%, with less dense core urban counties of small metro areas showing an average homeownership rate of 65%. Related ‹ Single-Family Permits Decline in May 2023Tags: county estimates, exurban homeownership rates, HBGI, homeownership by county, homeownership rates, urban homeownership rates

Homeownership across US Counties2023-07-18T08:16:21-05:00

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