Home prices have seen a significant increase of 42% since 2020. The rise in both mortgage rates and borrowing costs has made it more challenging to afford a home in today’s market. As a result, prospective buyers need to earn 80% more than they did four years ago to comfortably purchase a home.
Median incomes have only risen by 23% over the same period, leaving many people unable to enter the housing market. In 2020, a household earning $59,000 per year could afford a typical home priced at $240,815. At that time, this income level was below the US median income of $66,000, meaning more than half of American households had sufficient funds to buy a home without overextending their budgets.
Today, those shopping for a home need to earn $106,000 annually to afford a median-priced home at $342,941. This is $47,000 more than they needed to earn in 2020 to afford a home and well above the current average income of $81,000.
A recent Zillow analysis has shown how difficult it has become to break into homeownership as the cost of purchasing a home has outpaced income growth, pushing hopeful buyers out of the market. In fact, only a handful of major metropolitan areas were found to be affordable at the median income. Zillow defines affordability as spending no more than 30% of your income after offering a 10% down payment.
Monthly mortgage payments have nearly doubled over the past four years, with today’s typical buyer facing a monthly payment that is 96% higher compared to 2020 levels. This equates to an average payment of $2,200 per month with a 10% down payment.
The main factors behind this increase are the significant rise in home values and mortgage rates. Mortgage rates have gone up from around 3.5% in early 2020 to between 6.5% and 7% so far this year. Limited housing supply has also contributed to the issue.
In 2023, buyers needed an income of $97,000 to afford a typical home, up from $86,000 in 2022. This was $22,000 above last year’s median household income of $75,000.
“The income needed to comfortably afford a typical home is now six figures,” said Orphe Divounguy, chief economist at Zillow. “It’s a big increase that’s due to a combination of higher prices, mortgage rates, and limited supply.”
Neither mortgage rates nor home prices are expected to ease anytime soon, with economists from Fannie Mae predicting rates to drop to 6% by the end of the year and Zillow forecasting home prices to increase by 0.9% over 2024 to an average of $349,611.
Younger buyers are also facing challenges, as the pressure of affordability has delayed their entry into homeownership. It now takes 8.5 years for a household making the median income to save enough for a 10% down payment, a year longer than it would have in 2020. The average age of first-time homebuyers has also risen from 31 to 36 in the past five years.
To overcome these hurdles, buyers are turning to strategies such as “house hacking” and seeking financial assistance from friends and family. In 2023, 21% of those who purchased reported getting financial help from friends or family, according to Zillow.
In conclusion, the affordability of homes has significantly decreased in recent years, with the income required to purchase a home outpacing wage growth. This has resulted in many prospective buyers being priced out of the market and forced to employ creative strategies to afford a home.
Article generated from corporate media reports.
Independent Journalism Is Dying
Ever since President Trump’s miraculous victory, we’ve heard an incessant drumbeat about how legacy media is dying. This is true. The people have awakened to the reality that they’re being lied to by the self-proclaimed “Arbiters of Truth” for the sake of political expediency, corporate self-protection, and globalist ambitions.
But even as independent journalism rises to fill the void left by legacy media, there is still a huge challenge. Those at the top of independent media like Joe Rogan, Dan Bongino, and Tucker Carlson are thriving and rightly so. They have earned their audience and the financial rewards that come from it. They’ve taken risks and worked hard to get to where they are.
For “the rest of us,” legacy media and their proxies are making it exceptionally difficult to survive, let alone thrive. They still have a stranglehold over the “fact checkers” who have a dramatic impact on readership and viewership. YouTube, Facebook, and Google still stifle us. The freer speech platforms like Rumble and 𝕏 can only reward so many of their popular content creators. For independent journalists on the outside looking in, our only recourse is to rely on affiliates and sponsors.
But even as it seems nearly impossible to make a living, there are blessings that should not be disregarded. By highlighting strong sponsors who share our America First worldview, we have been able to make lifelong connections and even a bit of revenue to help us along. This is why we enjoy symbiotic relationships with companies like MyPillow, Jase Medical, and Promised Grounds. We help them with our recommendations and they reward us with money when our audience buys from them.
The same can be said about our preparedness sponsor, Prepper All-Naturals. Their long-term storage beef has a 25-year shelf life and is made with one ingredient: All-American Beef.
Even our faith-driven precious metals sponsor helps us tremendously while also helping Americans protect their life’s savings. We are blessed to work with them.
Independent media is the future. In many ways, that future is already here. While the phrase, “the more the merrier,” does not apply to this business because there are still some bad actors in the independent media field, there are many great ones that do not get nearly enough attention. We hope to change that one content creator at a time.
Thank you and God Bless,
JD Rucker
