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The MReport Webcast: Tuesday 3/3/2015

Homeownerships rates for the fourth quarter in 2014 were the lowest they have been in six years, according to information released by the U.S. Census Bureau. About 64 percent of homes were owned by occupants as of the fourth quarter in 2014, a drop from the third quarter rate of 64.4 percent. This is the lowest rate for any quarter since at least 1995, the first year listed in the Bureau’s statistics. Homeownership rates were highest in the Midwest at 68.3 percent and lowest in the West at 58 point 6 percent.

Age matters when it comes to ownership. Older residents are more likely to own their own home. Households owned by residents 65 or older had the highest percentage of ownership rates at 79.5 percent, while residents under 35 scored lowest at 35 point 3 percent.  The rate of homeownership can change drastically by age. While the numbers of homeowners age 35 to 44 was 58.8 percent that number jumps to 75.8 percent for owners age 55 to 64.

Lower interest rates have a powerful impact on home price appreciation, according to a report released by John Burns Real Estate Consulting. Home prices have increased 29 percent faster than incomes in the past 15 years largely due to falling mortgage rates. Each 1 percent drop in interest rates in the last 15 years has allowed home sellers to raise prices 12 percent.  According to the report, a typical family earning $60,000 per year can afford a mortgage payment of $1,800 per month, and would have qualified for a $245,000 mortgage in the year 2000 when mortgage rates were 8 percent.

About Author: Jordan Funderburk

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