Two studies published on the same day in July reached the same conclusion from opposite directions. The widely cited U.S. homeownership rate of roughly 65% does not measure how many adults actually own homes, concealing a large and growing group of people, especially younger workers, who live in owner-occupied homes they do not own.
The first study comes from the Federal Reserve Bank of Minneapolis. In "New Homeownership Measure Puts People First", their researchers point out that the familiar 65% homeownership rate is really an owner-occupancy rate. It counts housing units with a resident owner, not people who own homes. Their alternative, the homeowners-to-population ratio, counts adults instead. By that measure, the national rate is 53%.
The gap is significant. The authors find that 13.9% of American adults live in owner-occupied homes without owning them, more than one in eight. These are adult children living with homeowning parents, older parents living with their adult children, other relatives, and unrelated adults such as friends and roommates. As the authors note, many of these adults are likely to pay some kind of rent but are excluded from standard renter counts.
The effect is sharpest at the start of a career. For households headed by adults under 35, the traditional rate was 37% in 2024. Measured by person, only 22% of adults under 35 owned their homes. The authors also find that states with higher housing costs show wider gaps between the two measures. Hawaii, nearly the least affordable state by rent-to-income ratio, shows a gap of 18.9 points. North Dakota, the most affordable, shows 3.9 points, and only 10% of its young adults live with a parent against a national average of 30%.
The second study is from the Urban Institute and may explain why. In their research, "High Housing Costs Are Keeping More Young Adults in Their Parents' Homes" they show that roughly 20% of Americans ages 25 to 34 live with their parents, nearly double the 11.8% share in 2005. Grouping metropolitan areas by rent, they find median two-bedroom rent in high-cost metros climbed 29% between 2005 and 2024 in inflation-adjusted terms, against 17% in low-cost metros. By 2024, the share of young adults living with parents ran 5.8 percentage points higher in expensive metros than in cheap ones. In 2005 that difference was two-tenths of a point.
What This Means for HR
The studies do not examine workplace implications directly, but they highlight several issues HR leaders should consider:
- Relocation and geographic pay assumptions deserve a second look. Moving a young employee from an affordable market to an expensive one may quietly move them from independent housing into a shared household. Test relocation packages against local rent-to-income ratios, not just a general cost-of-living index.
- Financial wellness programs built around an owner-versus-renter assumption may miss a significant segment of employees. These studies should encourage employers to examine their workforce demographics and consider whether benefits such as student loan support or down payment assistance reach the population they actually employ.
- Homeownership may reduce relocation risk, but it does not eliminate retention risk. As any seasoned HR professional will tell you, retention efforts should focus on the employee experience, career opportunities, and total rewards rather than assumptions about personal circumstances.
ASE Connect
BEVEL: ASE partner, BEVEL, provides an employee homeownership benefit program that offers comprehensive, no-cost homeownership support making home purchasing, selling, and refinancing homes more affordable for working adults. Employees receive up to $12,000 as a closing credit on each transaction, matched with vetted lending and real estate professionals, and this benefit is provided at zero direct expense to participating organizations or their employees.
Connect with BEVEL at https://myhomeownership.poweredbybevel.com/bevel-ase-partners. Download an informational flyer here.
Sources: urban.org; minneapolisfed.org