Housing Won't Heal Until the Renters Come Back
Wall Street Journal
By Nick Timiraos
... Rising foreclosures have led the national homeownership rate to slide to around 67%, down from its 2004 peak of 69%. But the study finds that the current recession also led to an even steeper decline in household formation for rental apartment markets.
That bodes ill for the housing market, says Gary Painter, a professor at the University of Southern California who authored the study, because when household formation restarts, it will disproportionately benefit the rental market at first. As more rental households are added, that could cause the homeownership rate to register a larger decline.
The study also suggests that households that have moved during the recession have been more likely to become renters than owners after moving...