The American Dream Is Shifting
Homeownership in the United States is expected to dip in 2025 for the first time in nearly a decade, according to real estate firms.
As of April 1, about 86.19 million Americans owned homes, a slight decrease of 0.1% from the previous year’s 86.28 million.
The last decline occurred in the second quarter of 2016, when homeownership fell to 74.36 million from 74.4 million in 2015.
Cheng Zhao, the director of economic research at Redfin, noted that various factors, including inflation and rising mortgage rates, are pushing many out of the housing market. High real estate prices are also making it harder to buy a home.
After 2016, the homeownership rate consistently climbed, reaching 78.42 million in 2019. Zhao mentioned that low mortgage rates, which persisted for over a decade following the 2008 financial crisis, enabled many to purchase homes. However, the landscape shifted in 2022 when inflation and interest rates rose significantly, leading to higher mortgage costs.
“Mortgage rates have stayed elevated for three years now, impacting homeownership rates,” Zhao explained.
Real estate prices are climbing rapidly. Zhao pointed out that many people are simply being priced out of purchasing homes.
At the same time, the percentage of renters has grown slightly from 34.9% at the beginning of the year to 35% in the second quarter of 2025. Zhao attributed this to “relative affordability” since rental prices seem lower compared to the skyrocketing costs of buying.
“Yes, rents are high and burdensome for families, but relative to home prices, they appear more manageable in many areas,” she added.
In addition to economic factors, young Americans are tending to delay marriage and starting families, which, according to Zhao, may be influencing the decline in homeownership and the rise in rental households.
New York City, in particular, reported a homeownership rate of just 49.4% in the second quarter of 2025, making it one of the lowest among the nation’s metropolitan areas, second only to Los Angeles at 46.4%. This is a notable drop from over half of the population (51.3%) owning homes in 2023, and 50.6% in 2022. Interestingly, the city’s homeownership rate is beginning to recover after plummeting to 47% at the start of 2023—the lowest figure in at least six years.
