Last year we had the least affordable housing market in decades, and things haven’t gotten much better. Home prices, rents and mortgage rates are still high, and Americans are feeling the pain. “Half of homeowners and renters in the U.S. sometimes, regularly or severely struggle to pay their housing costs,” a Redfin official said Opinion poll found.
More than 42 million households spent more than 30% of their income on housing in 2022 latest available data shows, making them what many call “cost-burdened.” It shouldn’t be that much of a surprise. Property prices and rents skyrocketed during the pandemic-induced real estate boom; The former is still hitting all-time highs and the latter has fallen slightly. Mortgage rates last year reached their highest level in more than two decades, but have also fallen. Income, however, could not keep up. So people make sacrifices.
They either take fewer or no vacations, skip meals, work more hours and more shifts, sell their belongings, borrow money, retire, delay or forego medical care, work part-time jobs or receive cash gifts, according to the Redfin survey.
“Housing has become so financially burdensome in America that some families can no longer afford other essentials like food and medical care and are forced to make major sacrifices, work long hours and beg others for money to pay their monthly bills can cover costs,” said Chen Zhao, head of economic research at Redfin.
Mortgage payments are near all-time highs, and it’s no longer clear when or if the Federal Reserve will cut rates this year, especially after today Hot Jobs Report. “More jobs also mean the decline in interest rates could stall as the Federal Reserve reassesses inflation risk,” Lawrence Yun, chief economist at the National Association of Realtors, said in a statement, later adding: “Mortgage rates are likely to remain unchanged .” without further measurable declines in the coming months.”
What’s more, the salary had to be paid afford a starter home has almost doubled since the pandemic, requiring buyers to earn $30,000 more than they actually make Buy a typical house. Housing affordability is a given in the truest sense of the word Influence how Americans plan to vote in the upcoming presidential election.
From the survey we know that Millennials, Baby Boomers and Generation Redfin found that Generation Zers were working overtime, selling belongings and skipping meals.
Separately, some media outlets this week published stories about multigenerational housing; Vox said it was so “We’re coming back in a big way.” The publication included an anecdote from a 23-year-old woman who works at a nonprofit in Nashville, makes $50,000 a year and is moving back in with her parents. It also referenced a Pew Research Center in 2022 analysis That found that in 2021, a quarter of American adults ages 25 to 34 lived in a multigenerational family household — up from 9% in 1971. And so Assets has previously reportedMoving back in with mom and dad is so common that it has all but lost its stigma – but outside of America it never really had a stigma, if any, it’s the norm in several countries.
Additionally a RentCafe analysis last year found that 20% of Millennials and 68% of Generation Z still live with other family members. In fact, California was the state with the most Millennials and Gen Zers living in multigenerational households. This shouldn’t surprise you either – the average home value in California is about $765,000 and the average rent is $2,775; The former is 120% above the national average and the latter is 34% above the national median. More recently a Generational Trends Report A study from the National Association of Realtors released this week found that 24% of younger millennials between the ages of 25 and 33 have moved directly from a family home to a home of their own.
Last year a 24 year old woman told Assets She moved into a tiny house in her parents’ backyard in College Station, Texas. She lived there rent-free for five years, allowing her to buy her own home for $250,000. “If I had to rent, it would have been impossible for me to buy a house,” she said at the time. “I don’t think I would do that [have been] can buy for another five to seven years.”