U.S. Home Purchase affordability directly influences multifamily rental property rents and values. In 2023, only 16% of homes were affordable in America, falling from 21% in the year before.
An affordable listing was defined as one with a monthly mortgage payment no more than 30% of the median monthly income of that county. Below, we show the share of affordable listings in the 97 biggest U.S. metropolitan areas by population:
Although mortgage...U.S. Home Purchase affordability directly influences multifamily rental property rents and values. In 2023, only 16% of homes were affordable in America, falling from 21% in the year before.
An affordable listing was defined as one with a monthly mortgage payment no more than 30% of the median monthly income of that county. Below, we show the share of affordable listings in the 97 biggest U.S. metropolitan areas by population:
Although mortgage rates may decline over the year if the Federal Reserve cuts interest rates, it may not be enough to boost the supply of affordable housing.
That’s because rates may not fall sharply enough to undo the “golden handcuff” effect, where homeowners are reluctant to sell to hold on to their low mortgage rates. Adding to this, home construction has fallen significantly since the global financial crisis. During this time, home builders and lenders became increasingly cautious, leading home construction to drop 55% between 2006 and 2021.
Although mortgage rates may decline over the year if the Federal Reserve cuts interest rates, it may not be enough to boost the supply of affordable housing.
The good news is that new-home construction is forecast to increase in 2024, with single-family housing starts projected to grow 4.7%.
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