The Future of Household Formation and Homeownership in California

Forecasting State Homeownership Trends

Trends in household formation and homeownership have important implications for states’ housing markets and broader economies. They also reveal who has benefited from homeownership and who has been shut out of this critical wealth-building tool. To better understand the past and future of household formation and homeownership in California, we look at trends by age, race, and ethnicity. Our projections, using data from decennial censuses and the American Community Survey, show what will happen over the next two decades if current policies stay the same. For more details on the methodology, see our report.

Household Formation

We look at changes in the number of households (defined as one or more people who live in a housing unit) for four racial and ethnic groups: Hispanic, non-Hispanic white, non-Hispanic Black, and people of other races, which includes Asians, American Indians, Alaska Natives, Native Hawaiians, other Pacific Islanders, and multiracial people (all of whom are non-Hispanic). We also examine household formation trends for people younger than 65 and people ages 65 and older.

Number of Households and Household Growth

Number of Households in California, by Race or Ethnicity
 
  1990 2000 2010 2020 2030 2040
Total 10,358,800 11,506,329 12,575,560 13,245,999 13,879,147 14,206,483
White 7,020,657 6,685,059 6,507,770 6,168,217 5,757,400 5,193,137
Black 720,662 762,441 806,510 810,898 821,154 809,882
Hispanic 1,787,651 2,559,512 3,383,970 3,994,778 4,617,286 5,134,887
Other 829,830 1,499,317 1,877,310 2,272,107 2,683,307 3,068,578
  Household Growth: California Household Growth: Nationwide
2010–2020 2020–2030 2030–2040 2010–2020 2020–2030 2030–2040
Total 5.3% 4.8% 2.4% 5.9% 6.4% 5.4%
White −5.2% −6.7% −9.8% 0.1% 0.5% −1.3%
Black 0.5% 1.3% −1.4% 9.9% 10.1% 8.8%
Hispanic 18.1% 15.6% 11.2% 22.1% 19.2% 17.3%
Other 21.0% 18.1% 14.4% 20.9% 20.0% 18.4%

Sources: Decennial censuses, the American Community Survey, and Urban Institute projections.
Notes: Values for 2020, 2030, and 2040 are projected values. The “Other” category includes Asians, American Indians, Alaska Natives, Native Hawaiians, other Pacific Islanders, and multiracial people.

Number of Households in California, by Age


 

Number of Households in California, by Age, Race, and Ethnicity
 
  Younger than 65 65 and older
White Black Hispanic Other White Black Hispanic Other
1990 5,383,996 607,895 1,627,427 735,912 1,636,661 112,767 160,224 93,918
2000 5,031,629 637,249 2,322,316 1,297,955 1,653,430 125,192 237,196 201,362
2010 4,761,080 657,050 3,014,490 1,578,800 1,746,690 149,460 369,480 298,510
2020 4,039,285 610,900 3,377,223 1,791,143 2,128,931 199,998 617,554 480,964
2030 3,363,647 554,174 3,629,387 2,008,702 2,393,753 266,980 987,899 674,605
2040 3,021,835 529,083 3,784,225 2,229,119 2,171,302 280,799 1,350,662 839,459
Number of Households in the United States, by Age, Race, and Ethnicity
 
  Younger than 65 65 and older
White Black Hispanic Other White Black Hispanic Other
2000 60,344,232 9,972,344 8,293,773 4,728,999 18,748,904 1,835,658 928,629 627,564
2020 55,784,880 11,872,258 14,733,722 7,456,779 26,591,297 3,379,648 2,550,232 1,616,708
2040 48,524,107 13,051,680 19,825,205 10,817,807 33,236,589 5,553,598 6,026,735 3,088,951

Sources: Decennial censuses, the American Community Survey, and Urban Institute projections.
Notes: Values for 2020 and 2040 are projected values. The “Other” category includes Asians, American Indians, Alaska Natives, Native Hawaiians, other Pacific Islanders, and multiracial people.

Household Racial and Ethnic Composition, by Age, in California, and Nationwide

Sources: Decennial censuses, the American Community Survey, and Urban Institute projections.
Notes: Values for 2020, 2030, and 2040 are projected values. The “Other” category includes Asians, American Indians, Alaska Natives, Native Hawaiians, other Pacific Islanders, and multiracial people.

Homeownership

We look at changes in homeownership for four racial and ethnic groups: Hispanic, non-Hispanic white, non-Hispanic Black, and people of other races, which includes Asians, American Indians, Alaska Natives, Native Hawaiians, other Pacific Islanders, and multiracial people (all of whom are non-Hispanic). We also examine trends in the number of homeowners and renters younger than 65 and people 65 and older.

California Homeownership Rates, by Race or Ethnicity
 
  1990 2000 2010 2020 2030 2040
Total 55.7% 56.9% 55.9% 55.8% 55.3% 54.6%
White 61.8% 64.9% 64.3% 64.0% 63.3% 61.9%
Black 36.6% 39.0% 37.4% 34.8% 34.9% 35.4%
Hispanic 40.1% 43.7% 44.5% 45.9% 47.3% 48.8%
Other 54.0% 52.9% 55.4% 58.3% 58.1% 57.0%
National Homeownership Rates, by Race or Ethnicity
 
  1990 2000 2010 2020 2030 2040
Total 65.3% 66.2% 65.1% 64.7% 63.6% 62.2%
White 70.1% 72.4% 72.2% 73.0% 72.5% 71.4%
Black 45.2% 46.3% 44.3% 41.9% 41.1% 40.6%
Hispanic 43.3% 45.7% 47.3% 49.0% 50.2% 51.3%
Other 53.7% 53.0% 56.3% 58.1% 57.9% 57.4%

Sources: Decennial censuses, the American Community Survey, and Urban Institute projections.
Notes: Values for 2020, 2030, and 2040 are projected values. The “Other” category includes Asians, American Indians, Alaska Natives, Native Hawaiians, other Pacific Islanders, and multiracial people.

Homeowners and Renters, by Age, in California and Nationwide

California Homeownership Rates, by Age
 
  1990 2000 2010 2020 2030 2040
Younger than 65 51.6% 52.7% 51.6% 49.8% 48.4% 48.8%
65 and older 72.4% 74.5% 73.0% 72.9% 70.5% 66.5%
National Homeownership Rates, by Age
 
  1990 2000 2010 2020 2030 2040
Younger than 65 62.3% 63.0% 61.6% 59.5% 57.5% 56.5%
65 and older 75.8% 78.1% 77.5% 78.4% 76.0% 73.0%

Sources: Decennial censuses, the American Community Survey, and Urban Institute projections.
Note: Values for 2020, 2030, and 2040 are projected values.

Millions of Owners and Renters in California and Nationwide, by Age

Sources: Decennial censuses, the American Community Survey, and Urban Institute projections.
Note: Values for 2020, 2030, and 2040 are projected values.