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https://finance.yahoo.com/news/a-ne...es-but-fewer-owners-to-benefit-160802244.html
I personally feel like most decent neighborhoods are being priced out. There is a massive shortage of starter homes, unless you're in the worst parts of town. I don't see where even a family making over $100k can easily enter the housing market. I've seen a vast expansion in pricing in middle class neighborhoods shoot up from the $200's to the mid $400's, or up. All of the new construction I'm seeing are $200-300k condos or $450k - 600k housing.
Will we ever see new home construction for starter homes?
Can the economy really sustain this rapid growth? It's not as high as it was pre bubble, but the last two years have shot up fast here.
The housing bust is officially over, 10 years after it started. But like much else in the economy, the real-estate recovery has benefitted the wealthy more than others, with many ordinary folks still falling behind.
A prominent gauge of home prices, the S&P Corelogic Case-Shiller index, set a new record high in September, surpassing the previous high, from July 2006. Home prices on average have risen 5.5% during the last 12 months. “This indicates a completed recovery of US home prices since the Great Recession,” S&P Global said in a release. Here’s the home price index since 1988, with the solid line representing the national average:
Great news, right? Well, sure, if you’re a homeowner enjoying an ongoing boost in wealth. But the portion of Americans owning a home has been dropping since 2005, with the homeownership rate now at levels of the mid-1960s. In late 2004, the homeownership rate peaked at 69.2% of all households. Today, it’s just 63.5%.
The homeownership rate went too high during the housing boom, fueled by gimmicky mortgages, bogus underwriting standards and bad purchase decisions by consumers. But it may have overshot to the low side as millions endured foreclosure and banks severely tightened lending standards.
Lenders have loosened up a bit since then, but affordability has worsened as prices have rebounded, with a typical mortgage payment now costing about 15% of income. And that will likely rise into 2017, since interest rates have been going up since Donald Trump was elected president. There’s also a shortage of starter homes in many markets, since gun-shy builders burned during the bust are cautious about committing to new projects. And since they make bigger profits on costlier homes, that’s where builders tend to focus.
I personally feel like most decent neighborhoods are being priced out. There is a massive shortage of starter homes, unless you're in the worst parts of town. I don't see where even a family making over $100k can easily enter the housing market. I've seen a vast expansion in pricing in middle class neighborhoods shoot up from the $200's to the mid $400's, or up. All of the new construction I'm seeing are $200-300k condos or $450k - 600k housing.
Will we ever see new home construction for starter homes?
Can the economy really sustain this rapid growth? It's not as high as it was pre bubble, but the last two years have shot up fast here.