Own or Rent?

Henry Grabar:

Between 1970 and 1990, the population of Philadelphia shrank by a quarter, dropping from 1.95 to 1.59 million. Like many American cities, it seemed caught in a downward spiral.

Since then – like many American cities – Philadelphia has stabilized. The population now appears to have bottomed out at the millennium, and has been regaining residents over the past decade. But as it rebounds, Philly is becoming a different kind of city.

In the two most recent decades, which comprise the bounce of the city’s population curve, owner-occupied housing dropped even more steeply than in the ’70s and ’80s. Between 2000 and 2012, the percentage of Philly houses and apartments inhabited by owners dropped from 59 to 52, the second-sharpest decline among big U.S. cities during that time.

Meanwhile, renter-occupied housing exploded. More units are rented today in Philadelphia than in 1970, despite 400,000 fewer residents. According to a report from Pew Charitable Trusts, the size of the Philadelphia rental stock has grown by 37,000 since the millennium — a gain of more than 10 percent.

Philadelphia is a concentrated case of a larger trend in American housing: We are increasingly renting instead of buying our homes. Rental household growth is rising at double the rate it has in previous decades. Developers are building more multi-family units than they have in years. Last month, the homeownership rate fell to a 19-year low, down to 64.7 percent from a peak of 69.2 percent in 2004.