America still has plenty of vacant homes
Vacancy rates remain high despite tighter inventory levels
Despite tighter housing inventory levels, the number of vacant homes in America remains somewhat elevated.
The overall year-round vacancy rate hit 10.2% when accounting for total housing units, while approximately 2.7 of the total units were for rent, the Department of Commerce’s Census Bureau said.
"The overall year-round vacancy rate (excluding seasonal or vacation homes) is stuck well above pre-bubble levels," said Jed Kolko, chief economist and vice president of analytics for Trulia.
However, these vacant homes aren’t just in slow-growth markets like Detroit, with vacancy rates also high in Las Vegas, many Florida metros and other Sunbelt markets.
For the fourth quarter, the national vacancy rate for rental housing hit 8.2% and 2.1% for homeowner housing.
The rental vacancy rate, which hit 8.2%, was 0.5 percentage points lower than the rate in the fourth quarter of 2012 and 0.1 percentage points lower than last quarter.
The homeowner vacancy rate of 2.1% was 0.2 percentage points higher than the rates in the fourth quarter of 2012 and last quarter.
In addition, the homeownership rate hit 65.2% in the fourth quarter of 2013, which is 0.2 percentage points lower than the fourth quarter of 2012 rate.
But this is misleading since it omits people who are not in the housing market themselves as owners or renters, Kolko noted.
"Young people finally moving out of their parents’ homes into their own rental units would cause the homeownership rate to fall, even though that would be a healthy sign," Kolko said.
"Unfortunately neither today’s Census report nor other surveys give us a clear, definitive view on how quickly people are re-entering the housing market," he added.
While most regions showed little change in the U.S. homeownership rate, the Midwest witnessed the homeownership rate grow from 1.8% in the fourth quarter of 2012 to 2.2% in the fourth quarter of 2013.
Most regions recorded lower rental vacancy rates with the Northeast, Midwest, South and West watching their rental vacancy rates decline.