The Cost of Home Ownership Hits 17 Year High!

Owning a home is now more expensive than it has been in nearly two decades, with housing costs consuming about 35 percent of the average American’s income. Rising home prices and high mortgage rates have pushed affordability to its lowest level since 2007, creating challenges for potential buyers.

Despite a slowdown in home price growth, the median price of a single-family home hit a record $360,000 this spring. With mortgage rates hovering around seven percent, the cost of owning a home has risen faster than wages, making it harder for many people to buy. In nearly every U.S. county, home ownership is now considered "less affordable" compared to historical averages, exceeding the typical 28 percent of income recommended for housing costs.

Inventory levels have increased in some areas, which could eventually help ease price growth. Markets with more available homes, such as parts of Florida and Texas, are already seeing slower price increases, while areas with limited supply, like the Northeast, continue to experience steady price gains. Real estate experts predict that rising inventory may help stabilize the market, but high borrowing costs are likely to keep affordability a challenge.

With affordability at record lows, some buyers are holding off, hoping for better conditions. At the same time, sellers may start adjusting their prices to attract more interest. While home prices are still rising, the market could see a shift if mortgage rates stay high and more inventory becomes available.