The Mortgage Bankers Association has recently begun a series called the MBA Chart of the Week, which depicts trends in the housing and mortgage markets. This week's chart looks at home ownership and renting trends.
MBA forecasts for purchase originations to increase around 4% to $1.24 trillion in 2019, with another year of growth to $1.27 trillion in 2020. What’s behind the optimistic forecast? According to the U.S. Census Bureau, there were 1.6 million additional owner-occupied households in 2018 – the largest annual increase since 2004. In addition to the healthy labor market, improving supply conditions (in some markets) and moderating home-price growth, downsizing baby boomers and more millennials entering their prime buying years are creating sustained demand for home purchases. This week’s chart takes a look at the annual change in owner-occupied and renter households from 2002-2018. After nine years of mostly contraction in owner-occupied households, it’s hard not to notice that 2018 was the third straight year of growth. This trend is likely to continue.