Asians, Blacks and Hispanics to fuel new household growth

The Urban Institute has said that virtually all of the household growth in the U.S. expected over the next two decades will come from “minority households”.

Its researchers said in a report last week that between 2020 and 2040, around 16.1 million new net households will be created, and the vast majority of them will be either Hispanic, Black or Asian.

Hispanic households are expected to increase by 8.6 million, while Blacks will add another 3.3 million households and “other races”, which are mostly Asians, will add 4.8 million more. On the other hand, white households will decline by 600,000, the Urban Institute’s report said.

White households have the highest homeownership “headship” rates at present, but nonwhite group are making up an increasing share of the population. “Such changes in racial and ethnic composition will also affect overall headship rates,” the report noted.

Interestingly though, the Urban Institute forecasts that the household growth rate will slowdown in the next twenty years. Household growth averaged about 12.4 million units per decade from 1990 to 2010, but this is expected to slow to a rate of 8.5 million from 2020 to 2030, and 7.6 million from 2030 to 2040.

“This decline is the result of slowing U.S. population growth and lower headship rates for most age groups,” the Urban Institute said.

Source: realtybiznews.com