Homeownership affordability fell to its lowest level since the 1980s last year as mortgage rates reached a 23-year high and home prices set new records.
Borrowing costs have eased somewhat this year, with the average rate for a 30-year home loan down about a percentage point since October. But other prices related to homeownership keep rising and show little sign of abating.
Property taxes and home-maintenance costs are climbing in much of the country. Non-mortgage costs including property taxes, maintenance, utilities and insurance make up more than half of homeowners’ overall costs, according to a 2022 analysis by Fannie Mae economists.
Worst of all, home insurance premiums are soaring. Rates rose by more than 10% on average in 19 states in 2023 after a series of big payouts related to floods, storms, wildfires and other natural disasters across the U.S., according to an Insurance Information Institute analysis of data from S&P Global Market Intelligence. More Americans also moved to disaster-prone areas in recent years, increasing the exposure to these events.
Escalating costs on multiple fronts mean that many first-time buyers will continue to find homeownership a financial stretch.
Consumer prices rose 3.5% in March from a year earlier, the Labor Department said Wednesday. The stronger-than-expected inflation data could prompt Federal Reserve officials to hold rates at their current level for longer, which could also keep mortgage rates from declining.
The tens of millions of American homeowners who have locked…
Read moreThe cost of homeownership is up? So is the cost of everything else: a basket of groceries, an automobile, tuition, healthcare, rent, an hour of labor, and so on.
Is there a common denominator here? Yes: the declining purchasing power of the dollar. And the purchasing power is declining because the government keeps putting into circulation more dollars than is justified by the nation's output of goods and services.
Sure, prices are determined by supply and demand, and sure, for each price rise there are unique factors that affect the supply/demand equation. But there is also one facto… Read more
@D3fenceJoeLibertarian3wks3W
The US government went off the gold standard 50 years ago. Since then we have been playing games with fiat money (simple paper dollars, no backing), fractional reserve lending, and modern monetary theory (MMT). It has caused havoc in the economy.
We are now in a race to the bottom (like a third world country) as the money printing needs to accelerate to pay of interest on the debt as the debt grows.
I'd like to see a serious article about fiat money, government money printing, and the affects of inflation.
Same here in Texas. There have been no hurricanes, tornados, wildfires, floods or other damage in the region but insurance costs still keep skyrocketing, auto insurance, too. Just had a service charge on my a/c, $1,100. New carpeting for our living room and master bedroom, $9,500, water heater last year, $1,500. Nothing is reasonable any longer. I don't know how the average person can even maintain a home any longer.
The government locked businesses down, and then force-fed $6 Trillion in PPP to people who didn't need it - this was the spark that lit the inflation fire. The government has turned on its people
@WiseRedistrictingUnity3wks3W
Why bother going to work to manufacture or distribute a product when the government pays almost as much to stay home? And then they wonder why supply chains got interrupted.
That was their plan, get people hooked on government entitlements. It makes them much easier to control. It's working fabulously well for Joey and the boys.
My wife wanted me to take her somewhere expensive, I took her to the grocery store.
@GerrymanderRatDemocrat3wks3W
The grocery store is still a bargain compared with eating at a restaurant. The costs of labor are going up faster than the costs of goods.
@YearlyCaribouForward3wks3W
Remember, this administration keeps telling you this is imaginary, or conservative media hype. Who ya gonna believe??
@LyingJellyfishSocialist3wks3W
Bidenomics is hurting everyone. Time for this administration to be removed. Enough of the endless "war on" American wallets and freedoms.
@ISIDEWITH3wks3W
Considering the financial challenges faced by current homeowners, how important do you think government intervention should be in regulating these costs?
@9LH254QRepublican3wks3W
The government should take action to get these prices lowered and overall more affordable.
@ISIDEWITH3wks3W
With insurance premiums and property taxes increasing, how might this change the way we view home investments and savings?
@9LGZWLQ3wks3W
if everything increases people of lower income wont be able to afford proper housing.
@ISIDEWITH3wks3W
@ISIDEWITH3wks3W
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