The February 2024 edition of At a Glance, the Housing Finance Policy Center’s reference guide for mortgage and housing data, shows significantly lower home sales and refinance in 2023 relative to 2022, however origination volume has stabilized and is poised to grow in 2024. In addition, house price growth started to slow in the end of 2023. This edition features an analysis of the 2022 American Community Survey, with a focus on property type.
Findings from the 2022 American Community Survey
Housing Supply has Shifted Away from Naturally Affordable Property Types
Amid a severe housing supply shortage (page 21) especially at the lower-cost end of the market (page 23), increasing the number of total housing units is critical to reducing affordability constraints. However, increasing the supply of affordable units will decrease these constraints faster. In the filtering process, higher priced units enter the market, and some people move up, leaving older properties vacant. This causes prices and rents on older properties to fall, or to rise less quickly, however the process takes time to work. For this months’ special feature, we analyzed changes in property type and housing costs over time using the recently released 2022 American Community Survey.
The total number of occupied housing units increased by 10.9 percent in the last 11 years. However, manufactured housing has been vanishing over the last two decades. The number of occupied manufactured housing units decreased by 11.1 percent from 2000 to 2011 and by 2.3 percent from 2011 to 2022. Similarly, there was an overall 6.9 percent decline in occupied units in 2-4-unit buildings from 2000 to 2011, which the relatively small 2.7 percent increase from 2011 to 2022 did little to fix. By tenure, the number of renter-occupied units in 2-4-unit buildings increased by only 0.2 percent and the owner-occupied number increased by 14.7 percent.
The disappearance and slow recovery of these types of housing is concerning as they are more likely than other types of housing to be affordable. A relatively high share of occupants of manufactured homes and units in 2-4-unit buildings have low-to-moderate incomes. In 2022, 69 percent of rented units in 2-4-unit buildings were rented by families with low-to-moderate incomes, that is making 80 percent or less of the area median income. Renter-occupied units in 2-4-unit buildings are often a naturally occurring source of affordable housing. Manufactured homes have the highest share of low-to-moderate homeowners and a lower share of cost burdened homeowners than units in 2-4-unit buildings and multifamily buildings with 5 or more units. New manufactured housing has potential to increase housing supply relatively quickly and act a source of affordable housing, especially in places with low land costs.
Homeownership rates increased most for people of color and low-income households during and after the pandemic
The national homeownership rate increased by 1.9 percentage points from 2019 to 2022 due to low interest rates (page 9), and high purchase activity (page 20) during the COVID-19 pandemic. Homeownership rates increased more for low-to-moderate income households at 2.9 percentage points than high-income households at 0.6 percentage points. White households experienced the lowest percentage point increase in homeownership at 1.5 percentage points.
