Two Ways to Measure Homeownership

The traditional measure counts homes. A new Federal Reserve measure counts people.

For generations, homeownership has been closely associated with financial stability, independence and the opportunity to build wealth over time. It is also one of the statistics frequently used to assess the financial health of American households.

But new research from the Federal Reserve Bank of Minneapolis raises an important question: Does the homeownership rate commonly cited in news reports and economic discussions actually measure the number of people who own homes?

The answer is more complicated than it may appear.

The familiar homeownership rate measures homes, not people

The traditional U.S. homeownership rate is approximately 65%. This figure, produced by the U.S. Census Bureau, measures the percentage of occupied housing units in which the owner lives.

Technically, it is an owner-occupancy rate. It's a useful measurement as it tells economists, policymakers and housing professionals how much of the nation’s occupied housing stock is owner-occupied rather than rented.

It does not, however, tell us what percentage of American adults own their homes.

Researchers at the Federal Reserve Bank of Minneapolis have developed an alternative measure called the homeowners-to-population ratio, or HPOP. Rather than counting housing units, HPOP measures the percentage of adults who own their primary residence.

Using that approach, the national homeownership rate falls from approximately 65% of occupied homes to about 53% of adults who own a home.

Both statistics are accurate. They simply answer different questions.

How can the two numbers be so different?

Consider a home owned by a married couple whose adult child also lives with them.

Under the traditional measure, the house is counted as an owner-occupied housing unit, but the household includes three adults, only two of whom own the home.

Similar arrangements are common. An aging parent may live with an adult child who owns the property.

Siblings may share a home owned by only one of them. A homeowner may have a roommate. Young adults may continue living with their parents while saving money or managing the cost of housing.

The Minneapolis Fed estimates that 13.9% of American adults live in owner-occupied homes without being homeowners themselves.

This does not make the traditional homeownership rate incorrect. It means the figure is sometimes interpreted more broadly than its methodology supports.

Virginia also looks different when adults are counted

Virginia has traditionally had a relatively strong homeownership rate. Using 2024 American Community Survey data, Virginia’s owner-occupancy rate was calculated to be 67.3%. That means slightly more than two-thirds of occupied Virginia homes were occupied by their owners.

When the researchers measured the percentage of individual adults who owned their primary residence, however, Virginia’s rate was 54.8%.

That creates a difference of 12.5 percentage points between Virginia homes that are owner-occupied and Virginia adults who are homeowners.

The latest Census-based annual estimate places Virginia’s traditional homeownership rate at 69.6% for 2025. Because the Minneapolis Fed’s adult-level data currently extend only through 2024, the 2024 figures provide the fairest direct comparison.

Virginia therefore remains a state with substantial owner occupancy. Yet, as in the nation as a whole, the percentage of adults who personally own their homes is considerably lower than the familiar household-level statistic might suggest.

The difference is especially important for younger adults

The distinction becomes even more pronounced when homeownership is examined by age.

Under the traditional method, the 2024 owner-occupancy rate for households headed by someone under age 35 was 37%. Under the HPOP measure, only 22% of all adults under 35 owned their homes.

The difference occurs partly because many younger adults are not household heads. They may live with parents, partners or roommates and therefore disappear from a measurement based primarily on the status and characteristics of the household. Adults living in college dormitories and other group housing are also excluded from the traditional owner-occupancy calculation.

A household-based statistic can therefore make younger adults appear closer to homeownership than they actually are.

This matters because buying a home often marks an important transition in a person’s financial life. It can provide housing stability, offer protection from future rent increases and allow equity to accumulate over many years. Delays in reaching homeownership may consequently affect not only where younger adults live today, but also their longer-term ability to build wealth.

Housing costs may widen the gap

The Minneapolis Fed found that every state had a lower adult-ownership rate than owner-occupancy rate. It also found that the difference tended to be larger in states where housing costs were higher relative to income.

The likely reason for the gap is easy to understand. As the cost of renting or buying rises, more adults tend to share housing expenses with roommates or relatives. Adult children may remain at home longer, and relatives may combine households.

These arrangements can be practical, financially responsible and personally desirable. Multigenerational living, in particular, may provide important family, caregiving and cultural benefits.

Yet they also demonstrate why living in an owner-occupied home is not necessarily the same as owning one.

The researchers do not claim that housing costs are the only reason adults share homes. Family preference, caregiving needs, marriage and lifestyle choices also influence household formation. Their findings do suggest, however, that a person-level measurement reveals a stronger relationship between housing affordability and actual ownership than the traditional statistic does.

Which measurement should we use?

There is no need to discard the traditional homeownership rate. Owner occupancy remains valuable for understanding the housing market, neighborhood stability, property taxation and the division of the housing supply between owners and renters. When the subject is the housing stock or the household as an economic unit, it may be exactly the right measure.

HPOP is more useful when the question concerns people. It can help researchers examine how many adults own homes, how ownership varies by age, and how housing costs may affect an individual’s ability to form an independent household. It also provides a clearer view of adults who live in owner-occupied homes but do not share in the ownership of those properties.

The most responsible approach may be to use both statistics and label them clearly:

• Owner-occupancy rate: the percentage of occupied housing units in which an owner lives.

• Adult homeownership rate, or HPOP: the percentage of adults who own their primary residence.

Confusion arises when the first is presented as though it answers the second.

A more complete picture of homeownership

For established homeowners, the distinction may reinforce the significance of what ownership represents. It is often a major financial asset, a source of stability and the result of years of saving, planning and ongoing responsibility.

The traditional statistic tells us that owner-occupied housing remains widespread in Virginia and across the country. The new measure reminds us that ownership itself is not distributed quite as broadly as that familiar number implies.

So, are we measuring homeownership the right way?

We are measuring one important aspect of it. But when the question is how many American adults actually own a home, a statistic based on people provides a clearer answer.

Why This Matters to Homeowners

If you already own your home, this new research will not affect your homeowners insurance premium or the value of your property. Its significance is broader.

The study provides a clearer picture of how Americans are entering homeownership—and, increasingly, how many adults are delaying it.

That matters because homeownership has long been one of the primary ways families build wealth over time. Delaying that milestone can mean fewer years of equity growth and may influence future housing demand, lending programs, and public policy aimed at expanding homeownership.

For current homeowners, the findings are also a reminder of something easy to overlook. Owning a home represents more than having a place to live. It is a financial asset, a long-term investment, and, for many families, an opportunity that has become increasingly difficult to achieve.

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Sources

Federal Reserve Bank of Minneapolis, “New Homeownership Measure Puts People First,” July 15, 2026.

Federal Reserve Bank of Minneapolis, Homeowners-to-Population Data.

U.S. Census Bureau, Housing Vacancies and Homeownership Survey.

Federal Reserve Economic Data, Federal Reserve Bank of St. Louis, Homeownership Rate for Virginia.