The graph shows the rate of homeownership and mortgage debt of rural and small-town Americans. (Housing Assistance Council)

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Rural and small-town homeowners are more likely than the rest of the nation to own their dwelling “free and clear,” a new study by the Housing Assistance Council finds.

But rural homes have lower property values, the study also found.

“[The] United States is largely a nation of homeowners and homeownership is more prevalent in rural areas,” says the new report, which was written by HAC’s Michael Feinberg. 

“But many rural households still face challenges in accessing, attaining, and affording the purchase of a home. Lack of available stock, affordability and high cost loans are barriers to homeownership.”

The research brief uses a concept of “true homeownership.”  This means occupancy by households who own their homes “free and clear” without a mortgage.  

Almost half of rural and small-town homeowners own their dwellings with no mortgage debt.  Among all U.S. homeowners only about 37% have no mortgage debt.  

Homeownership in the United States, 2018

Map by Housing Assistance Council using 2014-18 American Community Survey Data. Full-page version of the interactive map.

Rural “true homeownership” is higher, according to HAC, because of the larger numbers of manufactured homes and the higher proportions of older residents.  If manufactured homes are financed with personal property loans, such shorter-term debt may be paid off sooner.  Older people, as they age, may reduce their mortgage debt, and eventually pay it off.   

HAC also points out that the values of rural homes are generally less than home values overall in the nation.  Nearly 38% of rural and small-town owner-occupied homes are worth less than $100,000.  But for all U.S. owner-occupied homes, 20% are valued at less than $100,000.  Homes valued at $300,000 or more make up less than 15% of rural and small-town homes but nearly one-third of all US owner-occupied homes.

HAC lays out some other facts on rural homeownership:

  • There are 16.5 million rural homeowners, making up 71.4% of all rural-area occupied homes.
  • About 75% of rural non-Hispanic Whites but only 55% of rural minority households own their homes.  
  • More than 80% of rural households headed by persons age 65 and over own their homes, compared to 42% of those under age 35.  
  • While rural homeownership declined during the great recession, there was less of a decline than in urban and suburban areas.  However, almost three-fourths of US counties saw homeownership rates decline between 2009 and 2018.

The publication is one of a series by HAC using the latest data from the 2020 Decennial Census and the American Community Survey.  The briefs will preview HAC’s latest Taking Stock report, to be published in 2020.  Taking Stock, a decennial HAC analysis of rural housing and poverty, has been published after each since national Census since 1984.     

Joe Belden is a writer and lecturer in Washington, D.C.  From 1989 to 2015 he was deputy executive director of the Housing Assistance Council.