Rising participation to provide less of a lift to housing

The participation rate for younger Americans had risen to a 10-year high by the end of 2018, with women driving most of that gain. That will have supported both rental and home purchase demand. But, with the unemployment rate set to rise as the economy slows, any future rise in the participation rate will provide less of a boost to rental and home purchase demand. That supports our view that home sales will do little more than tread water over the next couple of years.