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Tuesday, January 31, 2012

HVS: Q4 Homeownership and Vacancy Rates

by Calculated Risk on 1/31/2012 10:15:00 AM

The Census Bureau released the Housing Vacancies and Homeownership report for Q4 this morning.

As Tom Lawler has been discussing, this is from a fairly small sample, and the homeownership and vacancy rates are higher than estimated in other reports (like Census 2010). This report is commonly used by analysts to estimate the excess vacant supply for housing, but it doesn't appear to be useful for that purpose.

It might show the trend, but I wouldn't rely on the absolute numbers.

Homeownership Rate Click on graph for larger image.

The Red dots are the decennial Census homeownership rates for April 1st 1990, 2000 and 2010. The HVS homeownership rate declined to 66.0%, down from to 66.3% in Q3 2011.

I'd put more weight on the decennial Census numbers and that suggests the actual homeownership rate is probably in the 64% to 65% range.

Homeowner Vacancy RateThe Census researchers are investigating differences in Census 2010, ACS 2010, and HVS 2010 vacant housing unit estimates, but there is no scheduled date for any report.

The HVS homeowner vacancy rate declined to 2.3% from 2.4% in Q3. This is the lowest level since early 2006 for this report.

The homeowner vacancy rate has probably peaked and is now declining. However - once again - this probably shows that the trend is down, but I wouldn't rely on the absolute numbers.

Rental Vacancy RateThe rental vacancy rate declined to 9.4% from 9.8% in Q3.

I think the Reis quarterly survey (large apartment owners only in selected cities) is a much better measure of the overall trend in the rental vacancy rate - and Reis reported that the rental vacancy rate has fallen to the lowest level since 2001.

This is the most timely survey on households, but unfortunately the survey has serious issues - and sadly many analysts still use this survey to estimate the excess vacant supply. However this does suggest that the housing vacancy rates are falling.