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A House On Fire

March 7, 2023 | Posted in: Wealth Strategies

With the average home price having risen roughly 40% since the onset of the pandemic and thirty-year fixed-rate mortgages currently quoted at 7.4%, housing affordability is at its lowest level since the mid-1980s.

The most severe impact of rising prices and interest rates is on lower-income, minority, and first-time buyers, many of whom are effectively locked out of this most important means of building wealth. In 2022, only 26% of purchases were made by first-time buyers, the lowest figure on record. According to the National Association of Homebuilders, only 38.1% of homes sold were affordable to families earning the median income, again a new low. Finally, the gap between White and Black homeownership is wider now than it was in 1960.