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Wednesday, March 07, 2018
Recession Made Renters Majority in Honolulu
By Selected News Articles @ 12:57 PM :: 3362 Views :: Hawaii Statistics, Cost of Living

Renters Became the Majority Population in 22 Big US Cities

From RentCafe, January 25, 2018

Key takeaways

  • The population of almost a quarter of the 100 largest US cities has changed from homeowner- to renter-majority between 2006 and 2016
  • The increase in the number of renters at national level in a decade’s time was only slightly slower than the total population growth over the same period, demonstrating a big swing toward renting
  • The growth of the renter population outpaced that of homeowners in most large US cities

There’s no nice way to put this. The idea of owning a home lost much of the charm that once made it a structural element of the American Dream. Although the most recent data shows that the growth of the rental segment is losing momentum, it’s in part because homeownership has great losses to recover and it’s just starting to bounce back from the impact of the recession. In the late 2000s everybody was talking about the housing crisis, but the same wave that crushed the mortgage market—sending millions of homes to foreclosure—turned the apartment market downwind.

Our analysts took the American Community Survey archives from the US Census Bureau’s public database and simply compared the number of people living in renter- and owner-occupied housing units in 2006 and 2016 to see how the composition of our communities has changed over the past decade or so. But before we get technical, here’s a fun fact.

The total US population has increased by ~23.7 million people during the past decade, but this growth is far from evenly distributed between the two occupancy categories. The number of renters has increased by more than 23 million, and that of homeowners by less than 700K. In relative terms, the overall renter population has grown by more than a quarter in a decade. Meanwhile the number of owners (and people living in owner-occupied homes) has not only failed to keep up, but in truth, has remained virtually unchanged. 

Renters took over 22 of the largest cities

Though this shocking imbalance would have had to go on for a while longer to convert America into a renter nation, it was enough to tip the balance in some of the largest cities that used to be dominated by homeowners. In fact, renters have become the majority in almost a quarter of the 100 most populous cities.

Back in 2006 only 20 out of the 100 largest cities had more renters than owners. A decade was enough to boost the number of renter-dominated cities to 42.

The table below contains the 22 big cities where the number of renters has exceeded that of homeowners between 2006 and 2016. The entries are sorted by the proportional change of the renter share, but you can put them in the order of the actual renter share in 2006 or 2016 to see where they came from and where they got in roughly a decade by clicking on the column headers:

 

Cities where Renters Became Majority Population Since 2006

Rank City Renter Share 2016 Renter Share 2006 Renter Share Change 2006 vs 2016
1 Toledo, OH 50.3% 38.3% 31.3%
2 Memphis, TN 56.6% 44.6% 27.0%
3 Tampa, FL 50.3% 39.7% 26.8%
4 Hialeah, FL 54.7% 43.2% 26.5%
5 Stockton, CA 53.6% 42.4% 26.2%
6 Honolulu, HI 56.1% 44.6% 25.7%
7 Anaheim, CA 57.9% 46.3% 25.1%
8 Baton Rouge, LA 52.0% 42.4% 22.4%
9 Santa Ana, CA 56.6% 48.2% 17.5%
10 Columbus, OH 55.1% 46.9% 17.5%
11 Detroit, MI 52.0% 44.3% 17.4%
12 Cleveland, OH 56.0% 48.2% 16.3%
13 Baltimore, MD 52.5% 45.5% 15.4%
14 St. Louis, MO 51.9% 45.3% 14.6%
15 Minneapolis, MN 50.7% 44.5% 13.9%
16 San Bernardino, CA 54.0% 48.1% 12.2%
17 San Diego, CA 53.4% 47.9% 11.4%
18 Sacramento, CA 50.3% 45.3% 11.0%
19 Reno, NV 52.4% 47.8% 9.7%
20 Chicago, IL 51.3% 47.3% 8.5%
21 Fresno, CA 52.3% 48.6% 7.6%
22 Austin, TX 51.3% 48.4% 5.9%

 

Data Source: U.S. Census

In 8 of the cities listed above, the overall population has decreased. In Toledo, OH; Honolulu, HI; Santa Ana, CA; Baltimore, MD; Cleveland, OH; St. Louis, MO and Chicago, IL this relative desolation is attributable exclusively to the shrinkage of the owner population, as the number of renters has increased in each of them. Detroit, MI is the only exception, where the renter population has also experienced a minor, 2% decrease—trivial compared to the 30% setback that Motor City’s homeowner population has seen in the same period. In total, 12 of the top 100 cities have seen an overall population decrease, but in the case of Tucson, AZ; Buffalo, NY; Garland, TX and Mesa, AZ, this was not enough for renters to gain majority (although their renter populations have slightly expanded at the same time).

Rentership growth outpaced homeownership in 97 of 100 large cities

The 22 cities listed above are only the tip of the iceberg. In most other large cities, although the renter population still falls away from the number of homeowners, the ratio has gone through a dramatic change. In fact, apart from Anchorage, AK (where the rentership rate decreased by 1.3%), Irving, TX (-2.5%) and Winston-Salem, NC (-3.6%) all large US cities of the top 100 list have shifted in this direction….

Is the homeowner an endangered species?

To be concise: no.

Undoubtedly, the recession had a great impact on homeownership, and it’s hard not to agree if you look at the data from the last decade or so. However, it looks like it takes more to discourage Americans from buying a house than that.

As the years go by, it seems more and more certain that the fact that renting has seen a sudden gain in popularity is more a reaction to the economic crisis than a paradigm shift in the Americans’ attitude toward housing. This becomes most palpable when you break the data up into one-year chunks.

From 2007 until 2015 the American renter population had uninterruptedly been growing faster than the owner population, but after just four years, in 2010, the gap already started to close. And by 2016 the trend started to resemble what we’ve seen before the recession.

For the first time in years, the number of owners has increased by 0.9%, while that of renters came to a halt, and even decreased ever so slightly, by 0.1% on a national level. The last time the growth rates of the two segments looked similar to this was in 2006, when although negative growth was not an issue, the year-over-year expansion rate of the renter population still lagged behind that of owners by a full percentage point….

read … Full Report

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