The number of US cities where first-time homebuyers are faced with at least a $1 million price tag on the average entry-level home has nearly tripled in the past five years, according to new research.
A Thursday report from Zillow indicates that a typical starter home is now worth $1 million or more in 237 cities, up from 84 cities in 2019, underscoring America’s ongoing home affordability crisis.
“Affordability has been strained across the board,” Orphe Divounguy, a senior economist at Zillow, said. “We see the largest number of million-dollar starter homes in expensive coastal markets. We see them in markets with very low homeownership rates and we see them in markets with more building regulations.”
Precovid houses I could afford with a weeks pay. Now it’s the whole pay check. Ridiculous. Wanna fix the birth rate fix this. I’m tired of being born at the wrong time for everything. It’s always some bs.
Precovid houses I could afford with a weeks pay. Now it’s the whole pay check.
You mean rent, right? Right?
No, it was ultra cheap in my region. Cheaper than rent. I begged my partner to by a house since it was HALF our rent for a decent 2014 built house with acres of land. But nooo they want to rent for life. Now that I finally convinced them otherwise I can’t afford it. It causes alot of resentment for me.
You’re not making sense. What is the difference between “a weeks pay” and a “whole pay check”?
I hate you. Not really but we’re looking at 4 times that if we want to buy.
A side effect of sky rocketing housing prices is the annual tax liability also goes up, so people on a low or fixed income may no longer be able to afford the home they’ve lived in for decades. It’s the same problem that happens when neighborhoods are gentrified.
Some localities limit the increase in taxable value to a fixed percentage, which can combat that. The taxable value of my home is something like 25% of the actual value.
Obviously it sucks if they have to move, but it’s hard to feel too sorry for people that have become incredibly wealthy…
Also, municipal expenses don’t scale directly with property values… So while local taxes are often based on home values, they are adjusted to the level that meets the municipal budget. If everyone’s house doubles in value one year, taxes stay the same, not double…
That’s just how life is in a society. Don’t fall for the stupid Prop 13 trap that ruined so much in California.
Edit: how TF does this get downvoted to heck but my reply one down is upvoted even higher even though they say the same thing. Are you all just bandwagoners here? I thought I got away from redditors but I’m having second thoughts now.
People aren’t selling, because their tax bill will 10x at whatever place they downsize to. The older generations are all living in 5+ bedroom homes with 1 or 2 people while young people are raising families in 1br apartments. It means that across the state communities are dying out and young people just aren’t having families anymore. On top of this, suburban sprawl is completely out of hand because all the people who bought before prop 13 was passed were living in the metropolises since they were working age. Now that they are retired they still live where the jobs are, and the young working people have to commute 2+hrs each way to get to their jobs.
Literally cannot downsize. By that I mean people will be in a house that’s 2500+ sqft and their mortgage might double moving to literally any house in the city regardless of size. Most people don’t actually want a (poorly made cheap pos) mansion twenty or thirty minutes further from civilization, but that’s all that’s legal to build.
Most homes are simply out of reach for most Americans at this point, particularly if you live in a city. Even renting one is extremely expensive unless you move into a smaller town.
In the (rust belt here) midwest it’s almost reversed, homes in the rural areas cost much more than they do in the city. But our cities are car centric wastelands, where whole city blocks have been turned into parking lots.
Not to mention, smaller towns have much lower investment capacity in revitalizing century old infrastructure. There’s not enough appeal or added convenience for most to live in the middle of a 20-60k population center opposed to the privacy and space offered by smaller neighboring municipalities or outskirts. Footing the bill for renovation and raising rent to compensate, because almighty profit, eliminates their only clients. Housing’s fucked here all the way around.
P.s. any one got silly little 20k to pull me out of debt and give me a down payment on a starter home? 🙃
20 years ago, my mother bought a house for just under 50k. Houses in my hometown, of the same rough location and type, now go for 4x that.
Insane that housing prices have outpaced inflation by such a ludicrous degree. It’s almost like the system is broken, the ultra-rich and corporations have found all the good tricks and loopholes and are exploiting them to the detriment of both ordinary citizens and the nation as a whole.
I cannot recommend the book “Escaping the Housing Trap” highly enough. It talks a lot about the funding and financial products around housing and some of the fundamental flaws in the system. It’s quite easy to blame institutional owners and they’re certainly partly at fault, but it’s vastly more complex than that. It’s a really great scary read that genuinely had my mouth hanging open at times.
20 years is enough to double twice which would be 4x the price. That is how appreciating assets work.
Housing shouldn’t be an (in real-terms) appreciating asset. In the long run that just leads to feudalism.
Imagine if everything keeps appreciating for 200 years… now only cyborg Elon musk can afford to buy a house.
where did all this extra money come from to pay for these homes at these rates?
and where are they getting this extra money?
edit: c’mon people the bush and trump tax cuts were trillion dollar gifts to the worst people on earth and their heirs. These people need to be taxed.
Rich people have money.
Rich people buy things us poor can’t. Or more of those things.
Rich people control the markets.
Rich people squeeze the lifeblood out of us peasants.
Only rich people can afford homes.
Rich people raise rents the servants must pay because being homeless is illegal.
EAT THE RICH
