Current:Home > FinanceHomes "unaffordable" in 99% of nation for average American -Infinite Edge Capital
Homes "unaffordable" in 99% of nation for average American
View
Date:2025-04-27 20:42:01
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.
"The only people who are selling right now are people who really need to move because of a life event — divorce, marriage, new baby, new job, etc.," Daryl Fairweather, chief economist of Redfin, told CBS MoneyWatch. "That lack of new inventory is keeping prices high."
As of August, the national median existing home price was $407,100, up 3.9% from a year ago, according to the National Association of Realtors. The average interest rate on a 30-year home loan was 7.19%, up from 6.48% at the beginning of 2023, according to Freddie Mac. Prices will remain unaffordable as long as mortgage rates continue to rise, Fairweather said.
"The dynamics influencing the U.S. housing market appear to continuously work against everyday Americans, potentially to the point where they could start to have a significant impact on home prices," ATTOM CEO Rob Barber said in a statement Thursday. "We will see how this shakes out as the peak 2023 buying season winds down."
Difficult for first-time buyers
ATTOM's data adds to a growing body of real estate research in recent years that highlights the lack of affordable housing . It's an especially tall task for younger millennial shoppers, one expert said.
"First-time home buyers, who are often the most sensitive to interest rates, have had to postpone their home-buying dreams," said Dan Hnatkovskyy, co-founder of new home construction startup NewHomesMate, told CBS MoneyWatch. "Those older buyers with more cash on hand can buy down interest rates, or they can absorb a higher monthly payment and are still buying homes across the country."
- Why is the current housing market so expensive? "Blame the boomers," one economist says.
ATTOM defined "unaffordable" as someone who must devote more than 28% of their income toward paying for a particular home. Factoring in a mortgage payment, homeowners insurance and property taxes, the typical home priced today would require 35% of someone's annual wages, ATTOM said.
Cities with the most unaffordable homes include Los Angeles, Chicago, Phoenix, San Diego and Orange County, California, ATTOM said. Communities surrounding Cleveland, Detroit, Houston, Philadelphia or Pittsburgh have the most affordable homes compared with median salaries for residents there, according to the firm.
- In:
- Home Prices
- Home Sales
- Affordable Housing
Khristopher J. Brooks is a reporter for CBS MoneyWatch covering business, consumer and financial stories that range from economic inequality and housing issues to bankruptcies and the business of sports.
TwitterveryGood! (55)
Related
- What were Tom Selleck's juicy final 'Blue Bloods' words in Reagan family
- Singer’s lawsuit adds to growing claims against Sean ‘Diddy’ Combs
- CLIMATE GLIMPSE: Wildfires plague U.S. West and Brazil, Yagi rampages in Vietnam
- Kentucky authorities still hunting suspect in I-75 shooting that injured 5
- Nevada attorney general revives 2020 fake electors case
- An ER nurse says it was ‘second nature’ to rescue a man trapped in hurricane floodwaters
- 2024 VMAs: Miranda Lambert Gives Glimpse Inside Delicious Romance With Husband Brendan McLoughlin
- Tyreek Hill police incident: What happened during traffic stop according to body cam
- Taylor Swift Eras Archive site launches on singer's 35th birthday. What is it?
- Travis Kelce Reacts to Taylor Swift’s Sweet 2024 MTV VMAs Shoutout
Ranking
- San Francisco names street for Associated Press photographer who captured the iconic Iwo Jima photo
- DWTS Alum Lindsay Arnold Speaks Out on Secret Lives of Mormon Wives as a Mormon Herself
- Pac-12 adding four Mountain West schools Boise State, San Diego State, Fresno State, Colorado State
- 2024 MTV VMAs: Taylor Swift Makes History With Artist of the Year Win
- Intel's stock did something it hasn't done since 2022
- Coach Outlet Bags & Wallets Under $100—Starting at $26, Up to 75% Off! Shop Top Deals on Bestsellers Now
- When Will the EV Sales Slump End? Here’s What the Experts Say
- Garland says he won’t let the Justice Department be used as a political weapon
Recommendation
Tarte Shape Tape Concealer Sells Once Every 4 Seconds: Get 50% Off Before It's Gone
Michigan leaders join national bipartisan effort to push back against attacks on the election system
NFL sets record, averages 21 million viewers per game in Week 1
Off the Grid: Sally breaks down USA TODAY's daily crossword puzzle, Body Composition
Rolling Loud 2024: Lineup, how to stream the world's largest hip hop music festival
How Taylor Swift and Travis Kelce Reacted to Jason Kelce Discussing His “T-ts” on TV
2024 VMAs: Katy Perry Debuts Must-See QR Code Back Tattoo on Red Carpet
Patrick Mahomes brushes off comments made about his wife, Brittany, by Donald Trump