CBS: Homes "unaffordable" in 99% of nation for average American

[alang1216]

Homes "unaffordable" in 99% of nation for average American

Home prices have jumped so much that Americans must pay a third of their income on housing, according to one study.

www.cbsnews.com

The typical American cannot afford to buy a home in a growing number of communities across the nation, according to common lending standards.

That's the main takeaway from a new report from real estate data provider ATTOM. Researchers examined the median home prices last year for roughly 575 U.S. counties and found that home prices in 99% of those areas are beyond the reach of the average income earner, who makes $71,214 a year, according to ATTOM.

Housing experts point to couple trends driving up housing costs. Mortgage rates have topped 7%, adding hundreds of dollars per month to a potential house payment. At the same time, homeowners who locked in at lower mortgage rates during the pandemic have opted not to sell out of fear of having to buy another property at today's elevated rates, depleting the supply of homes for sale.

But here's the kicker.....Ironically, if mortgage rates were to drop, that would increase demand for purchasing and thereby drive the prices of homes up even higher.....Same with rent....The only solution is a deflationary event.

We saw in 2008 what happens when debt gets monetized and integrated with other investment vehicles. Who knows what vehicles are now being used to leverage risky mortgages.

True they only did about 600 counties but they reflect the 71K income.....Much like my AO, and I can tell you straight up that is the case....Both homes and rent are sky high.

Right now there are only 9 rental homes available in my town....Average 3 BR price per month is $2.5K....2BR $2K a month....There are no apartments for rent.

Dam the free market! We need gov't price controls since they always work so well. (sarcasm)

 

[1srelluc]

Dam the free market! We need gov't price controls since they always work so well. (sarcasm)

Meh, the .gov just needs to require employers pay $40.00 a hour to flip burgers.....Right?

The question is where does it all come to a middle? I've no idea what is propping things up now from a huge deflation.

Commonsense would dictate that interest rates are really too low, maybe a couple more basis points increase by the fed would get the job done.

I remember when home loan rates were 12% and I was happy to get a 10.50% home loan and all my peers were buying homes, nobody rented for any longer than it took to have a home built.....That is what I did.

The house like I had built for $31,900 in 1977 (161K in today's money) sold for $275K a couple of weeks back....It was just a 1K sq ft brick rambler "starter home" on a town lot.

 

[Mac-7]

Homes "unaffordable" in 99% of nation for average American

Home prices have jumped so much that Americans must pay a third of their income on housing, according to one study.

www.cbsnews.com

The typical American cannot afford to buy a home in a growing number of communities across the nation, according to common lending standards.

That's the main takeaway from a new report from real estate data provider ATTOM. Researchers examined the median home prices last year for roughly 575 U.S. counties and found that home prices in 99% of those areas are beyond the reach of the average income earner, who makes $71,214 a year, according to ATTOM.

Housing experts point to couple trends driving up housing costs. Mortgage rates have topped 7%, adding hundreds of dollars per month to a potential house payment. At the same time, homeowners who locked in at lower mortgage rates during the pandemic have opted not to sell out of fear of having to buy another property at today's elevated rates, depleting the supply of homes for sale.

But here's the kicker.....Ironically, if mortgage rates were to drop, that would increase demand for purchasing and thereby drive the prices of homes up even higher.....Same with rent....The only solution is a deflationary event.

We saw in 2008 what happens when debt gets monetized and integrated with other investment vehicles. Who knows what vehicles are now being used to leverage risky mortgages.

True they only did about 600 counties but they reflect the 71K income.....Much like my AO, and I can tell you straight up that is the case....Both homes and rent are sky high.

Right now there are only 9 rental homes available in my town....Average 3 BR price per month is $2.5K....2BR $2K a month....There are no apartments for rent.

The high biden interest rates are a problem

 

[1srelluc]

The high biden interest rates are a problem

I don't think that they are high enough.

 

[petro]

Plus most home builders are not building what we once called starter homes.

I can tell you we don't.
No money in it.
Margins are tighter than hell for builders.
Everything we do is over a million, 5,000 sq. ft homes with all the ridiculous amenities. The market in the Twin Cities is exploding with McMansions. Even during the shutdown we couldn't keep up with demand. These people with obviously plenty of money will pay any price to get their dream home up.

The large national builders are using pre made wall panels and installing them with half assed workers. They literally slop up as quick as possible apartments, condos and townhomes. Still those units outprice most people looking for affordable housing.

 

[alang1216]

Meh, the .gov just needs to require employers pay $40.00 a hour to flip burgers.....Right?

The question is where does it all come to a middle? I've no idea what is propping things up now from a huge deflation.

It was unions that built the middle class. Ancient history.

Commonsense would dictate that interest rates are really too low, maybe a couple more basis points increase by the fed would get the job done.

I remember when home loan rates were 12% and I was happy to get a 10.50% home loan and all my peers were buying homes, nobody rented for any longer than it took to have a home built.....That is what I did.

The house like I had built for $31,900 in 1977 (161K in today's money) sold for $275K a couple of weeks back....It was just a 1K sq ft brick rambler "starter home" on a town lot.

Raising the interest rates will make mortgages more expensive, offsetting any decrease in housing prices. It is a game you can't win so let the market determine the price, you Commie.

 

[1srelluc]

, you Commie.

Go bugger yourself.

 

[SweetSue92]

Homes "unaffordable" in 99% of nation for average American

Home prices have jumped so much that Americans must pay a third of their income on housing, according to one study.

www.cbsnews.com

The typical American cannot afford to buy a home in a growing number of communities across the nation, according to common lending standards.

That's the main takeaway from a new report from real estate data provider ATTOM. Researchers examined the median home prices last year for roughly 575 U.S. counties and found that home prices in 99% of those areas are beyond the reach of the average income earner, who makes $71,214 a year, according to ATTOM.

Housing experts point to couple trends driving up housing costs. Mortgage rates have topped 7%, adding hundreds of dollars per month to a potential house payment. At the same time, homeowners who locked in at lower mortgage rates during the pandemic have opted not to sell out of fear of having to buy another property at today's elevated rates, depleting the supply of homes for sale.

But here's the kicker.....Ironically, if mortgage rates were to drop, that would increase demand for purchasing and thereby drive the prices of homes up even higher.....Same with rent....The only solution is a deflationary event.

We saw in 2008 what happens when debt gets monetized and integrated with other investment vehicles. Who knows what vehicles are now being used to leverage risky mortgages.

True they only did about 600 counties but they reflect the 71K income.....Much like my AO, and I can tell you straight up that is the case....Both homes and rent are sky high.

Right now there are only 9 rental homes available in my town....Average 3 BR price per month is $2.5K....2BR $2K a month....There are no apartments for rent.

It is awful.

All the bickering we do about Gaetz and McCarthy...most Americans don't give a crap about that. If you can't afford your rent/mortgage and food, nothing else matters.

 

[1srelluc]

It is awful.

All the bickering we do about Gaetz and McCarthy...most Americans don't give a crap about that. If you can't afford your rent/mortgage and food, nothing else matters.

I guess that is why there is more CC debt now than ever before.....That and people are dipping into their 401ks and other retirement accounts to pay for everyday expenses more than ever before too.

I also suspect allowing 5M+ illegals to enter the country in under three years also puts continuing pressure on the rental market too.

As for Congress they could disband the whole thing for no more good than they do....Just appoint Rand Paul to run the whole thing.

 

[LibertyKid]

The real estate market in this country is inexplicable. Prices are sky-high, and interest rates are higher than they have been in decades and yet...

There is a SHORTAGE of desirable existing homes, and houses selling at or above asking price is the NORM. In most cases, contingencies in offers disqualify the offer because others are bidding with NO CONTINGENCIES at all, often taking the risk of having a period with TWO mortgage payments.

Often, people who "cannot afford" a house are buying it anyway with creative financing strategies or help from parents.

My understanding is that banks are still very tight with lending requirements. But I don't understand how a house that was worth $150,000 18 months ago is now worth $250,000 and the bank underwriters and approving these loans.

Or, as you suggest, buyers are getting down payment assistance from somewhere. My wife and I are ready to downsize. But home prices and interest rates are keeping us out of the market. Not because we can't afford it, but because it doesn't make financial sense right now. Plus, the huge risk is that the market collapses. Then, you bought that house for $250K and bam, the market crashes and that house is now $150K and the buyer is upside down and locked in until they can refinance or the market goes back up to a reasonable level.

In past generations, NOT buying a house as soon as possible was a self-harming strategy because the house you want will cost more next year (or later). I'm not sure that is the case right now, because prices are grossly inflated, and those houses might be CHEAPER in a year or two. And interest rates will surely come down as soon as we can get that zombie out of the White House.

Still, renting for the long term is still cheaper than owning a home... paying the Mortgage loan, taxes, and upkeep, as well as the inevitable expensive repairs.

I don't know about renting vs home buying. I know around here, a nice rental will cost you a couple thousand a month. You might be right with the prices of new homes. And in our area, it seems all homes are at this $250K mark. If the house is in reasonable condition (and that means it could be 3 decades out dated but structurally fine) these homes are going for $250,000 minimum.