A friend of mine recently attended a Conference sponsored by Charles Schwab. James Smith, Chief Economist with Parsec Financial Management presented a program entitled "The U.S. Housing Market: Better Times Ahead" . In his presentation Mr. Smith brings up some very interesting points regarding home ownership in the United States, the demographics of home ownership and what these statistics signal for the future.
From 2004 through 2006 home ownership rates ran about 69% with a slight downturn in 2007 to 68.4%. Many housing experts believe that due to U.S. demographics and mobility habits of Americans a ceiling of approximately 75% is realistic. Mr. Smith looked at how home ownership rates varied by age group, the lowest rate of home ownership was among people under 25 years old. This group had an ownership rate of 24.8% in 2006. There is a sharp increase in ownership in the 25 - 29 year old group, to 41.8% and a further increase to 55.9% in the 30-34 age group. Home ownership peaked in the 70 - 74 year old age group at 83% followed closely by 82.4% ownership in the 65 - 69 year old group and 81.5% in the 60 - 64 group and 80.4% in the 55 - 59 year old group.
With baby boomers making up 77 million of our 300 million population, the home ownership rate should continue to increase for years to come. Baby Boomers (those people born in the U.S. between January 1, 1946 and December 31, 1964) according to Mr. Smith, have changed most other aspects of life in the U.S. as they have aged, so it shouldn't be surprising that their impact on the housing market has been, and will continue to be, enormous.
These home ownership rates should continue having a large effect on the Prescott area. Many of those individuals in the high ownership groups are retirees looking for the small town atmosphere and mild climate that the Prescott area offers, so I agree with Mr. Smith, The Prescott Area Housing Market will see Better Times Ahead!!