"Housing, particularly in places with a decent job market, has become increasingly unaffordable in the US. That's partly thanks to quantitative easing during the pandemic, which supercharged housing inflation. The median American home price in January was $418,000, about a 45% increase from $289,000 five years ago, per Redfin data. Wages haven't gone up at the same rate, and housing prices compared to income have reached an all-time high."
"In post-pandemic America, there are three groups of people. First, there are those who own their home outright and those who bought a house before the pandemic, then refinanced during the historically low interest rates we saw in 2020 and 2021. Many of those homeowners are now sitting on large piles of equity. Then you've got the people who bought their first home during the pandemic, with super-low interest rates."
"Finally, you've got group three: people who are completely and utterly screwed. Unless you're earning big bucks, have generous parents, or want to live in the middle of nowhere, good luck buying a first home right now. Indeed, nearly a quarter of millennials say they expect to rent forever. Prices are historically high and mortgage rates, while still far lower than they've been in the past, are around 6.3%."
Housing in many US job markets has become increasingly unaffordable, driven in part by pandemic quantitative easing that intensified housing inflation. The median American home price in January was $418,000, up about 45% from $289,000 five years earlier. Wages lagged behind price growth, pushing housing-price-to-income ratios to record highs. Homeowners who bought before or refinanced during 2020–2021 benefited from low rates and accumulated equity. Buyers during the pandemic gained advantage from sub-inflation mortgages. First-time buyers without high incomes or family support face severe barriers, with many millennials expecting to rent indefinitely. Higher mortgage rates and tariffs on construction materials threaten further cost increases.
Read at www.theguardian.com
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