For many US households, financial stability and generational wealth hinge on the ability topurchase a home.
Today’s inaccessible housing market makes that difficult.
It’s a stark reminder that interest rate cuts alone won’t unlock the housing market for everyone.
Today’shousing affordability crisisis a product of multiple factors, such as elevated borrowing costs, rising prices andlimited inventory.
Every household has different spending needs and mandatory expenses.
Economically disadvantaged households generally experience a higher rate of inflation than the rest of the population.
“Not only has this trend persisted but it has intensified,” said Ludwig.
Preliminary calculations show housing costs increasing by 11.5% in 2023 and 10.4% in 2024.
Compare that with the 145% increase in home prices over the same period.
The effects of wage growth aren’t equal either.
The metrics also don’t always factor in how wealth is distributed across US households.
In August, the median home price was $433,229, according toRedfin.
Homebuyers today need to earnmore than $100,000to afford the mortgage payments on a median-priced US home.
There are ways to make saving for a down payment easier.
Lower mortgage rates are certainly positive.
