With interest rates near rock bottom, unemployment down sharply and a Florida economy on the rise again, you'd think homeownership would be on the upswing.
My first home mortgage in 1984 was near 12 percent. Today's mortgage rates are closer to 4 percent and have been for years, a bargain price for home loans I never expected to see in my lifetime.
But cheap mortgages are not stemming the tide. Homeownership peaked in Florida in 2005-2006 at 72.4 percent of the population. It has been heading south ever since, falling under 63 percent in late 2014.
That's a lower homeownership rate than this state has seen in at least 30 years.
The great American dream of homeownership is backpedaling fast since its peak nine years ago.
Experts warn homeownership may decline further. The cost of housing, the demographic and educational mix of potential buyers, stagnant wages and the near-term threat of rising interest rates all work against an increase in home buying. And the rising cost of renting only compounds the struggle of younger people trying to save for a down payment.
Many young people are less enamored with the "dream" of homeownership after they saw their parents and friends struggle in the recession with mortgages larger than the value of their homes or, of course, foreclosures.
Why stretch so far to buy a home — plus pay for property taxes and insurance — only to risk another housing bubble and crash in values?
Some housing analysts argue the decline in homeownership rates is nearly over, having returned to the low 60 percent range consistent for decades before the runup in housing in the early 2000s.
Others disagree. The Urban Institute predicts homeownership will continue to drop for at least 15 years.
Citing a national demographic shift, the Urban Institute expects more than 75 percent of new households this decade, and almost 88 percent in the next decade, will be formed by minorities. These new households, nearly half of them Hispanic, will have lower incomes, less wealth and lower homeownership rates than the U.S. average.
Shrinking homeownership is part of a bigger trend in this country: the rising cost of housing in general. As fewer households seek to buy homes, more seek to rent, putting pressure on rental prices.
Potential homeowners will find it tougher to qualify for a mortgage as lower-wage jobs replace better-paying positions. The Federal Reserve also seems poised to raise interest rates later this year.
Homeownership was once a way the middle class differentiated itself from the poor.
Does any of this really matter? Yes, says Ron Terwilliger, who spent nearly 20 years running Trammell Crow Residential, one of the nation's largest apartment developers.
If renters are unable to ever become homeowners, Terwilliger recently told the Wall Street Journal, who will buy those homes when today's homeowners need to sell?
Nobody. Until those home prices start falling again.
Contact Robert Trigaux at firstname.lastname@example.org.