Economists' Outlook
Housing stats and analysis from NAR's research experts.
A Nearly Unbelievable Data Point: The Birth Rate
By: Jessica Lautz
The number one question I hear from members is: how is it possible that the birth rate in the country is actually at more than a 100-year low? What usually follows is that people think of and discuss their favorite neighborhood child or grandchild (you know you have a favorite!). In actuality, the birth rate is now the lowest level since the National Center for Health Statistics first started collecting the data.
Let's break down what that means. This is the birth rate per 1,000 people who are in the childbearing years of 15 to 44. This development is not new, as birth rates have been declining as a relatively consistent trend since 2007. What is surprising is the acceleration in the decline in the last year—which declined 4% compared to past declines of 1-2% annually.
The baby bust has likely been fueled by both economic and health concerns of women during the pandemic. As some families saw women leave the workforce in the last year, it may not have been financially possible to add a new baby to the family. Some women may not have felt comfortable going into a doctor's office during a pregnancy or had limited family support systems due to safety concerns of COVID-19. Others may not have wanted to add another child after Zoom-schooling kids all day while juggling work.
However, it is important to note that this is not a select group of women with a decline in birth rates. Rather, it is also a decline for every age category year-over-year and a decline for every racial and ethnic group. The largest decline in birth rates was for those aged 20 to 24, followed by those aged 25 to 29.
This decline also has implications for housing and homeownership. Having a baby is often a decision-maker to impel a move into a larger home, just as having a young adult leave or return to the home often causes the empty nester to think about moving. The decline is also being mirrored by home buyers with children in the home. In 1985, 58% of buyers had children under the age of 18. Today only 33% of home buyers have children under the age of 18. This impacts current buyers' decisions on both the location of the home that is purchased and the size of the home purchased. The latest update will be available soon in the 2021 Profile of Home Buyers and Sellers report to see if this trend continues among home buyers.
Jessica Lautz
Deputy Chief Economist and Vice President of Research
Dr. Jessica Lautz is the Deputy Chief Economist and Vice President of Research at the National Association of REALTORS®.
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