Homeownership and Household Trends: Families vs. Child-Free Homes

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Seemingly, the rapid pace of change is the only constant in the US housing market over the past two decades. Demographic, preferential, and cyclical patterns have shifted rapidly — leading to an ever-evolving housing environment. In this analysis, we will examine homeownership rates and household estimates for homes with and without children. Utilizing data from the US Census Bureau’s American Community Survey, we find that households without children — including renter- and owner-occupied homes — have surged since the turn of the century.

Homeownership Rate: Households with Children

Through 2023, among households with at least one child living in the home, the share that owned their primary residence stood at 69.6%. While this dipped slightly in 2021 (68.6%) as the pandemic jolted the housing market and family formation patterns, it has since recovered and moderated — jumping back to 69.6% in 2022 and remaining there in 2023. The current mark is only 10 bps below the recent peak set in 2020 (69.7%) and 40 bps below the all-time high hit in 2005 — achieved just before the onset of the US housing crisis.

Following the US housing crash, the impact on homeownership rates was particularly severe for households with children. Following the 2005 peak (70.0%), the homeownership rate for this group fell off in ten (10) consecutive years, reaching a low of 64.2% in 2015. Following 2015, driven by a sustained economic recovery, the housing market returning to health, and pent-up household formations, the homeownership rate for these households surged, climbing by 5.5 percentage points in just five (5) years.

Homeownership Rate: Households without Children

Much like their childbearing neighbors, households without children in the home saw a drop in homeownership rates in the aftermath of the US housing crisis. However, the commonalities between the two groups seem to start and stop there. The homeownership rate for childless households peaked one year later (2006) at 65.3%. Compared to the “with children” group, the housing crisis had a far more muted effect. The duration of decline for households without children lasted only seven years — three years fewer than homes with children. Moreover, the cumulative decline was a mere 2.5 percentage points, comparing favorably to the dip experienced for with-children households (-5.8 percentage points).

Generational differences and so-called “survivor effects” are the likely reasons that this group experienced a milder decline in homeownership post-housing crisis. As of the most recent data, the average age of a homeowner with children in the home is 48.8 years old —more than a decade younger than the average age of homeowners with no children in the home (61.2 years old).

Share of All US Households

Measured as a share of all US households, without-children households are increasingly taking up a more substantial piece of the pie. Since the year 2000, the number of homeowners without children has grown from 36.3% to 39.1% of all US households. Impressively, this group’s total number of households has surged by 33.9% — the second fastest-growing subset in this analysis. Meanwhile, it is renters without children who claim the accolade of being the fastest-growing household type. Since 2000, childless renters have seen their ranks grow by 40.1%. Resultingly, they have gone from 20.6% of all US households at the turn of the Millennium to 23.3% in 2023.

On the other side of the ledger, households with children have grown in absolute numbers — but not quickly enough to maintain their market shares. The number of homeowners with children has grown 9.3% since 2000, though it has seen its share of all US households slip by 3.6 percentage points to 26.2%. Similarly, renters with children have grown in aggregate by 7.0% while their market share has fallen by 1.8 percentage points to 11.5% of households.

Analysis

While cyclical (housing crisis) and exogenous (pandemic) factors have left their fingerprints on US housing trends in the past two decades, the most influential ones are structural. The two primary drivers causing declining shares of homes with children are the dual-pronged catalysts of delayed childbearing and baby boomers reaching retirement age and becoming empty nesters. The average age of a first-time mother has grown by about 2.5 years since the US housing crisis. Meanwhile, since 2000, the number of senior households in the US has jumped by about 50%, while non-senior households have stagnated.