An affordability crisis is making some young Americans give up on ever owning a home
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Young people feeling financially drained by the affordability crisis say that owning a home is now a pipe dream. Mortgage rates surged in recent years, hitting the highest levels in more than two decades last fall. While rates have come down slightly since then, home prices remain painfully elevated and a limited inventory of housing is still failing to keep up with demand.
The minimum down payment required to purchase a home depends on various factors, but the conventional wisdom is that hopeful buyers should save to put down 20%. According to the National Association of Realtors, the typical down payment for a first-time homebuyer was 6% last year, but even saving up that much can be daunting. It’s taking nine years for the typical homebuyer to save up for the median down payment on a home with the median value in the United States, according to Zillow data. The 2023 median home sale price was $389,800, according to NAR, up about 1% from 2022 and the highest on record.
The situation isn’t a whole lot better for renters, with rents barely coming down from record highs and half of tenants saying they can’t afford their payments. A 35-year-old who lives in the San Francisco Bay Area tells CNN, “Having kids will never be on the table. I haven’t even put a cent in my retirement fund, so there is just zero hope for me to ever own a home." CNN spoke with other young Americans, who say they are living with parents or even leaving the country as housing affordability remains out of reach.
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10moHeads up for those with mortgages, even with fixed rate mortgages or no mortgage at all. The property tax increases and all other increases ,utilities sewer ,water,electric ,heat ,internet,trash and insurance costs have all increased! The seniors on fixed incomes who don't have mortgages are being forced to sell there homes due to the cost of living and property tax increases. This is a crime while these $$ are being sent and spent on countless issues that don't relieve any of us.
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10moHome ownership was the dream of my parents. I have found it expensive. The more youthful see it as an unnecessary personal burden.
Photographer, storyteller, sort of hungry (if you have snacks, please share).
10moMy wife and I were absolutely resigned to never owning a home before we had a slight windfall of money that was able to eliminate enough debt and give us enough breathing room that we could start saving. We just bought a house in Q3 of last year and opted for a variable interest rate loan in hopes that markets cool down in 3-5 years. We COULD NOT have bought it without the life insurance from my mother-in-law's passing. And that's just sad when you consider my wife and I make over 100K combined and live in a relatively cheap city. The American dream is simply not the same in 2024.