Homeownership in Philadelphia Appears to Have Steadied
Following years of decline, the rate of homeownership in Philadelphia appears to have stabilized.
In July 2014, we published a report documenting the decline of homeownership in Philadelphia over the previous decade. At the time, the findings indicated that the city—long known as a place of homeowners—might be on the verge of seeing a majority of residents becoming renters. Analysis of the latest data from the U.S. Census’ American Community Survey, however, suggests that this trend may have stalled.
The recently released 2014 homeownership rate for Philadelphia is 52 percent, which is slightly higher than the number for the previous year. Given the margin of error in the estimates, this means that the city’s rate essentially remained constant for the past three years for which data were available—2012, 2013, and 2014.
This steadying of Philadelphia’s homeownership rate follows years of decline. Nationwide and in the 30 largest U.S. cities, there has been an ongoing drop in homeownership. For those 30 cities, the numbers went down a median of 3.2 percentage points from 2000 to 2014, although rates in a few of the cities have stabilized, as they have in Philadelphia. Several factors have contributed to the longer-term decline, experts say, including the collapse of the pre-recession housing bubble and the subsequent toughening of requirements to qualify for a mortgage.
Whether the recent finding is merely a pause in a long-term trend or something more significant remains to be seen. In Philadelphia, the bulk of new residential construction, much of which is taking place in and around Center City, has been rental housing. And even though the homeownership decline in the city since 2000 has been more pronounced than in many other cities, Philadelphia still has a higher percentage of owner-occupied homes than most cities in the Northeast and Midwest.