Homebuyers need to earn 80% more than in 2020 to afford a house in this market. It’s not just due to high mortgage rates
by cnbc_official
Homebuyers need to earn 80% more than in 2020 to afford a house in this market. It’s not just due to high mortgage rates
by cnbc_official
7 comments
Factors beyond [high mortgage rates](https://www.cnbc.com/2024/03/06/weekly-mortgage-demand-surges-11percent-as-more-homes-hit-the-spring-market.html) are affecting [housing affordability](https://www.cnbc.com/2024/02/26/more-than-half-of-aspiring-homeowners-face-two-common-roadblocks.html) for many Americans, according to experts.
Almost four years ago, a household earning $59,000 annually could afford a new mortgage without spending more than 30% of their monthly income and with a 10% down payment, according to a [recent](https://www.zillow.com/research/buyers-income-needed-33755/) report by Zillow Group.
That is no longer the case today.
While the typical household in 2024 makes about $81,000 a year, up from $66,000 in 2020, wages have not kept up with housing costs.
“Since January of 2020, the typical mortgage payment on the typical home in the U.S. has nearly doubled,” said Orphe Divounguy, a senior economist at Zillow.
Nowadays, potential homebuyers need to make about $106,500 a year in order to afford the typical home today, an 80% increase from January 2020, according to Zillow.
More: [https://www.cnbc.com/2024/03/12/why-homebuyers-need-to-earn-more-to-afford-a-home-in-2024.html](https://www.cnbc.com/2024/03/12/why-homebuyers-need-to-earn-more-to-afford-a-home-in-2024.html)
Cue the boomers saying they had it harder
That’s what I’ve learned living in TX. Even if home prices/rates go down, property taxes and insurance costs are still only going up. There is no stopping it.
The uber rich inflated the market by being the highest bidder on everything for sale. Not complicated.
Bidenomics is working as expected. Stop complaining
Too few people own too many homes.