In another sign of housing market malaise, the rate of homeownership has slipped to its lowest level since 2003.

The latest homeownership data released from the Census Bureau in "Census Bureau Reports On Residential Vacancies And Homeownership" reveals the share of households with an ownership stake was 68.4 percent in the second quarter, seasonally adjusted.

The last time it was at that mark was the last quarter of 2003, when the rate was moving up toward the record level of 69.4 percent reached in the second quarter of 2004.

During the second quarter a year ago the rate was 68.9 percent.

Since the second quarter of 2006, demographically speaking, the most slippage in the rate of homeownership was found among blacks, people living in the Midwest, those aged 35 to 44 and households with incomes equal to or greater than the median family income.

The failure of subprime loans and other risky mortgages have been the leading culprits credited with slicing through the ranks of homeowners.

Defaults and foreclosures have forced businesses to shutter shops and curtail any remaining subprime and so-called "Alt-A" loans nontraditional mortgages that are riskier than prime loans with fixed rates.

Experts say the tighter mortgage money causes some homeowners to lose their home because they can't refinance their way out of higher-interest rate trouble. Also, a growing number of buyers can't find home buying financing, especially if they are cash-poor or less creditworthy first timers.

Two recent studies have forecast some two million homeowners will lose their homes to current conditions before the market bottoms out.

Another contributor do depressed rates of homeownership are home prices. In the stratosphere when the boom fizzled, many home prices remain elevated and unaffordable for buyers who don't have leverage. The market is also draining equity from some properties.

The Federal Reserve's July 25, 2007 "Beige Book" offer a bleak outlook at much of the nation's real estate market.

The periodic survey of bank executives and other professionals in the 12 federal banking districts offers anecdotal evidence about the state of the economy.

"Most Districts said that residential construction and real estate activity continued to decline on balance. Atlanta, Chicago, St. Louis, and Minneapolis said construction decreased. Boston and Kansas City said housing markets remained 'soft' and 'weak,' respectively, while San Francisco indicated that residential markets were weak and had slowed further in some areas," the report summarized.

"New York said markets were mixed but stable. Two notable exceptions were the Cleveland and Richmond regions, which experienced slight increases in sales. Atlanta said home inventories remained high, as did Dallas (even after a slight decline in the recent period). Inventories increased in Kansas City, but they declined in New York, and contacts in Boston and Cleveland described the number of homes for sale as 'normal' and 'acceptable,' respectively," the Beige Book reported.

The book revealed a return to price appreciation in Boston as Kansas City's price slide slowed. Richmond and Chicago reported slower rates of increase or the beginning of declines, and in Dallas, some contacts projected a correction in entry-level home prices.

Comments from those in Cleveland indicated uncertainty about when the bottom would come, and previously price-optimistic market watchers in Dallas revised their housing outlook down. Atlanta commentary came with expectations of more price declines as those queried in Florida expected continued flatness, according to the Beige Book.

The Census' report reveals the market is slowly absorbing the supply of vacant homes. During the second quarter the national vacancy rate for rental housing was 9.5 percent down only from 9.6 percent a year ago. For homes the vacancy rate inched down from 2.2 percent to 2.6 percent. Both rates were also down from the first quarter this year, according to the Census Bureau.

The Midwest and the South had the highest rental vacancy rates, 11.1 and 11.5 percent respectively. The Northeast came in at 7.4 percent, the West, 6.7 percent.

Homeowner vacancy rates were highest in the South at 3.1 percent followed by 2.6 percent in the Midwest, 2.3 percent in the West and 1.9 percent in the Northeast, the Census reported.

Published: August 8, 2007

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Broderick Perkins parlayed a career in old-school journalism into a contemporary digital news service that really hits home. The award-winning consumer journalist, originally from Wilmington, DE, is founder, publisher and executive editor of the bootstrap DeadlineNews Group, a Silicon Valley-based editorial content and consulting service specializing in residential real estate, consumer news and related editorial consulting services. The DeadlineNews Group includes the website, DeadlineNews.com, offering real estate editorial content and consulting services, and its back shop, the Deadline Newsroom, an open house on news that really hits home. Perkins obtained his formal journalism education from University of Delaware and a journalism boot camp, the Institute of Journalism Education at the University of California-Berkeley. He went on to 20 years of service as a daily newspaper journalist at the Wilmington, DE News Journal and San Jose, CA Mercury News. Perkins covered housing on the San Jose Mercury News reporting team which earned a General News Reporting Pulitzer Prize in 1989 for coverage of the Loma Prieta earthquake. He has also produced real estate, consumer and small business content for the Wall Street Journal, Los Angeles Times, RealtyTimes.com, Nolo.com, Better Homes and Gardens, the National Association of Realtors, Homestore/Move and Intuit/Quicken among more than three dozen publications. In addition to managing the DeadlineNews Group, Perkins most recently served as chief editorial consultant for Nolo's Essential Guide To Buying Your First Home, Nolo, and writes real estate television scripts for RealtyTimes.com.