Today, only 36% of households can afford a new home, down from 59% in 2019
Buying a new single-family home in America now requires a household yearly income of $107,700, according to a new report from Oxford Economics. This is almost double what was needed in 2019.
Today, only 36% of households can afford a new home, down from 59% five years ago.
Home prices have risen sharply due to the pandemic, which caused many people to look for larger homes.
Cities like San Jose, San Francisco, Los Angeles and San Diego in California, have become especially expensive, with home prices reaching nearly $1.9 million.
On the other hand, places like Cleveland, Louisville, Detroit and St. Louis are still more affordable with prices ranging from $64,600 to $75,300.
The main reasons for the price increase are higher mortgage rates, a shortage of houses for sale, and higher demand.
While mortgage rates have gone down slightly, they are nearly double from the pre-pandemic era, making it harder for many Americans to buy homes.