A house costs roughly 3.6x the median income in 1984; today it is anywhere from 5.3x to 7.1x.
It is more difficult to buy a house now vs in the past.
Fox 9 says, “Home prices have surged 197% since 2000, while median household income has only risen 40%, making homes more than twice as expensive relative to income compared to 25 years ago.” Also, with higher mortgage rates interest rates, mortgages have risen leading to higher monthly payments and have increased the overall cost to borrow. This makes it harder to get loans and makes home buying harder for people without a huge savings.
Some people talk about how we make more money today versus in the past which is true, but housing prices have risen way faster than the income has. It puts us at a huge disadvantage than in the past. Also, there are way tighter qualifications requiring larger down payments and higher credit scores.
What needs to change is we need to build more homes because the lack of houses drives up cost. We also need to create more affordable housing. These solutions would stimulate the economy and would help create economic growth in communities allowing more homes being sold.
Housing prices are too high and create massive issues for young people when it comes to setting up for their future.
