U.S. Homeownership Rates, Rental Occupancies Remain Stable in Early 2020

Based on a new U.S. Census Bureau report, national residential vacancy rates in the first quarter 2020 were 6.6 percent for rental housing, and 1.1 percent for homeowner housing.

The rental vacancy rate of 6.6 percent was 0.4 percentage points lower than the rate in the first quarter 2019 (7.0 percent), but not statistically different from the fourth quarter 2019 (6.4 percent). The homeowner vacancy rate of 1.1 percent was 0.3 percentage points lower than the rate in the first quarter 2019 (1.4 percent) and the rate in the fourth quarter 2019 (1.4 percent).

The homeownership rate of 65.3 percent was 1.1 percentage points higher than the rate in the first quarter 2019 (64.2 percent) but was not statistically different from the rate in the fourth quarter 2019 (65.1 percent).

The first quarter 2020 rental vacancy rate was highest outside Metropolitan Statistical Areas (9.2 percent),which was higher than the rate in the suburbs (6.1 percent), and the rate in principal cities (6.3 percent). The rental vacancy rate in principal cities was not statistically different from the rate in the suburbs. The rental vacancy rate inside principal cities was lower than first quarter 2019, while the rates in the suburbs and outside MSAs were not statistically different from the first quarter 2019 rates.

The homeowner vacancy rate in the suburbs (1.0 percent) was lower than the rate in principal cities (1.3 percent), but not statistically different from the rate outside MSAs (also 1.3 percent). The homeowner vacancy rates in the suburbs and outside MSAs were lower than the first quarter 2019 rates, while the rate in principal cities was not statistically different from the first quarter 2019 rates.

The first quarter 2020 rental vacancy rate was highest in the South (8.5 percent) followed by the Midwest (7.1 percent), the Northeast (5.5 percent), and the West (4.1 percent). The rental vacancy rate in the South was lower than the first quarter 2019 rate, while the rental vacancy rates for the Midwest, Northeast, and West were not statistically different from the first quarter 2019 rates.

The homeowner vacancy rate was highest in the South (1.4 percent). Homeowner vacancy rates in the Northeast, Midwest, and West were not statistically different from each other. The homeowner vacancy rates in the Midwest and South were lower than the first quarter 2019 rates, while the Northeast and West were not statistically different from the first quarter 2019 rates.

Approximately 88.6 percent of the housing units in the United States in the first quarter 2020 were occupied and 11.4 percent were vacant. Owner-occupied housing units made up 57.9 percent of total housing units, while renter-occupied units made up 30.7 percent of the inventory in the first quarter 2020. Vacant year-round units comprised 8.8 percent of total housing units, while 2.6 percent were vacant for seasonal use. Approximately 2.2 percent of the total units were vacant for rent, 0.7 percent were vacant for sale only and 0.6 percent were rented or sold but not yet occupied. Vacant units that were held off market comprised 5.3 percent of the total housing stock - 1.5 percent were for occasional use, 1.0 percent were temporarily occupied by persons with usual residence elsewhere (URE) and 2.9 percent were vacant for a variety of other reasons.

The Mortgage Bankers Association's Chief Economist Mike Fratantoni commented on the report, "Data for the first quarter of 2020 continue to reflect the extremely strong housing market prior to the current COVID-19 pandemic and subsequent economic crisis. Homeowner vacancy rates dropped to the lowest level in more than 40 years, and the rental vacancy rate also remained quite low. Moreover, the homeownership rate increased to its highest level in almost eight years. Without a doubt, the rapid deterioration of the job market this spring will cause second quarter numbers to reverse course."