In 99 percent of 575 U.S. counties, home prices are beyond the reach of the average income earner.
“Why don’t Americans feel better about the economy and give Joe Biden more credit?,” Democrats whine.
The front page of today’s Wall Street Journal offers another brutal example of how routine, usually unavoidable expenditures — in this case, those associated with owning a home — have skyrocketed in recent years.
Darren Gondry has owned his four-bedroom home near a golf course in Louisville, Ky., since 2004. He and his wife, Lori Gondry, paid off their primary mortgage in 2021.
That hasn’t stopped other bills associated with homeownership from piling up. Their home insurance costs have risen 63 percent in two years. Their property taxes, utility costs and homeowners’ association fees have risen in recent years, too.
“I was so sticker-shocked,” Gondry said of the mounting home-cost increases. “I fear they’re here to stay.”
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.
When the typical American thinks about whether they can afford a house, they typically think about what they would need to earn to cover the monthly mortgage payment. (Note the average interest rate on a 30-year mortgage is now just under 7 percent.) But homeowners with mortgages are required to purchase home insurance, and obviously property taxes are not optional.
Last summer, the National Association of Realtors’ housing affordability index hit its lowest level in data going back to 1989.
On average, property taxes increased by 4.1 percent nationwide from 2022 to 2023, but some cities had enormous jumps; the highest annual year-over-year jumps were in Charlotte, N.C., at 31.5 percent; Indianapolis (19 percent); Kansas City (17 percent); Denver (16 percent); and Atlanta (15 percent). One of the reasons localities are hiking property taxes is because inflation has made everything the local government purchases more expensive.
One study released last autumn concluded, “Researchers examined the median home prices last year for roughly 575 U.S. counties and found that home prices in 99 percent of those areas are beyond the reach of the average income earner, who makes $71,214 a year.”
And yet the Democrats walk around fuming about what ingrates the American people are for not appreciating Joe Biden and his miraculous works.