quote:
The Median home value in the United States is now $450,000. The medium family income is 74500...We have an entire generation of people who cannot afford a roof over their head.

Nah.

First of all, your stats are incomplete.

"According to data from the National Association of Realtors, the median price for an existing home — one that's already standing, not new construction — was $387,600 as of November 2023."

People don't have to buy new construction. I get that $387,600 is still a lot, but it's not $450,000.

Secondly, I'm not sure how much median income tells you. For example, this year I will sell my business and retire. I will do so a multi-millionaire, but going forward I will have no ordinary income. Zero. I'll be at the bottom of your income chart. I won't even be able to draw Social Security for another 12 years. My wife will keep working b/c her job provides our health insurance, but our household income will be below the median you posted. Yet we could afford to buy a multi-million dollar home if we wanted to.

There are a lot of people my age and older that fit into that category.

quote:
Efficiency apartments in low crime areas are going for over $1500.

Um, o.k. Where you live, maybe.

I live in Alabama. State-wide, the median rent for an entire house (not just an efficiency apartment) is $1,395 with 6,387 available.

In Mississippi it's almost identical at $1,400 even with 2,204 available.

In Arkansas it's $1,350 with 3,036 available.

In New York City, however, the median for an apartment is $3,400, with over 15,000 available.

You get the point. It matters greatly where you live.

A much better statistic is rate of home ownership.

According to the US Census Bureau, in 1970, 64% of Americans owned a home.

Again according to the Census Bureau, in 2023 that number was up to almost 66%.

In fact, since 1965 the rate of home ownership has deviated from a 4 percentage point range only twice. Once in 2005 when it went up to over 69% and once in 2020 when it briefly spiked up to 68%. Other than that it has stayed between 63% and 67% for almost 60 years.

Similarly, you have to go back to 1985 to find fewer rental vacancies than 2023. In fact, between 1967 and 1985 there were fewer rental vacancies than there are now, but barely. We're talking a maximum of 1 1/2 percent. Other than that, we've got the lowest rate of rental vacancies since 1956.

So there are not a lot of unrented properties and we're still owning homes within the same range that we've been owning them for roughly 60 years.

So much for this: "We have an entire generation of people who cannot afford a roof over their head."

You're listening to the media. They like to report that the sky is falling.

This post was edited on 2/6/24 at 9:45 pm

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Posted by RiverCityTider

Jacksonville, Florida

Member since Oct 2008

4445 posts

Posted on 2/7/24 at 1:20 am to wackatimesthree

The Median home PRICE is 431k in Nov 2023.

quote:
The median family was already $9,000 short in August of the income needed to buy the median existing home, the association says, and the recent surge in rates since has moved another five million U.S. families below the qualification standard for a $400,000 loan, according to John Burns Real Estate Consulting. At 3% mortgage rates, 50 million households could get a loan that size. Now it's 22 million.

While an easing in treasury bond yields this week has brought the 30-year fixed mortgage back a shade below 8%, there is no quick fix.

The qualifying yearly income for a median-priced house in 2020 was $49,680. Now it's more than $107,000, according to the NAR. Redfin puts the figure at $114,627.

"[These are] stunning numbers that render house affordability even more challenging for too many American families, especially those looking to buy their first home," bond-market maven Mohamed El-Erian, an advisor to Allianz among many other roles, posted on X.

"It's a very worrisome development for America," NAR chief economist Lawrence Yun said.