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Data: U.S. Census Bureau; Chart: Naema Ahmed/Axios

The housing market is showing signs of life. Mortgages are being refinanced at astonishing rates, housing is more affordable thanks to lower interest rates, and Fannie Mae's housing sentiment index is at an all-time high.

Yet, but: Homeownership rates have plunged over the past 15 years, in a trend that won't (and shouldn't) reverse itself.

  • The homeownership rate started to decline in 2004–2005 in the middle of the housing boom. For all the record issuance of subprime mortgages, option ARMs and NINJA loans, the rate declined, at almost exactly the same rate at which it continued to deteriorate during the worst years of the financial crisis. Even the post-crisis recovery didn't change things. Only in the past couple of years have homeownership rates ticked up a tiny bit.
  • Student loans are part of what's going on, but only part. Most homeowners are college graduates, after all. And college graduates who have defaulted on a student loan, for any reason good or bad, are going to find it very hard to get a mortgage.

How it works: House prices have been rising where they're already unaffordable and falling where they're within reach. To put it another way: If you want to make a good investment, you can't afford it; if you can afford it, it's not going to be a good investment.

Demographic trends also work against homeownership.

  • There's a broad move out of rural areas and into urban ones, which is to say a move from where homeownership levels are generally high to where they're generally lower.
  • Homeownership among the white population is about 70%, but it's well under 50% for the black population and Hispanics, and even Asians are well below the white level. As America becomes increasingly nonwhite, the culture will continue to move away from the homeownership ideal.

The bottom line: Homeownership has long been at the heart of the American dream, and it accounts for a huge proportion of middle-class wealth. But it's on the decline, and it's not coming back.

Go deeper

Biden's pick to lead major banking regulator drops out

Saule Omarova, nominee for Comptroller of the Currency, at a confirmation hearing on Nov. 18. Photo: Anna Moneymaker/Getty Images

President Biden's pick to head one of the country's most powerful banking regulators is dropping out of consideration for the post, according to a statement from Biden that accepted the withdrawal.

Why it matters: Saule Omarova, nominated to lead the Office of the Comptroller of the Currency, faced a tough path to confirmation — with opposition from Republicans and moderate Democrats.

Judge temporarily blocks Biden vaccine mandate for federal contractors

Photo: Chip Somodevilla via Getty Images

A federal judge on Tuesday temporarily blocked President Biden's vaccine mandate for federal contractors nationwide.

Why it matters: It's the latest setback in the Biden administration's rollout of COVID-19 vaccine requirements. Federal judges in two states temporarily barred the administration from enforcing mandates for millions of workers last week.

Biden threatens Putin

Photo: Kremlin Press Office/Handout/Anadolu Agency via Getty Images

In a video call that lasted for just over two hours on Tuesday, President Biden warned Russian President Vladimir Putin that if Russia invades Ukraine the U.S. will impose unprecedented sanctions and provide additional weaponry to the Ukrainians, national security adviser Jake Sullivan said.

Why it matters: Russia's military activity on the border with Ukraine has triggered alarms from the U.S. and its European allies of a potential large-scale Russian invasion in early 2022. Sullivan said Biden made clear to Putin that, "things we did not do in 2014, we are prepared to do now."