As the cost of homes continues to rise, new research finds that these prices far exceed the average household income in many areas.
New to look for from Harvard Joint Center for Housing Studies found that single-family home costs in 2023 were about 4.9 times the median household income, putting homeownership out of reach for many families. The researchers released an interactive map This shows where the price-to-earnings ratio was the highest and lowest last year.
Single-family homes in many parts of Southern California were at least eight times more expensive than the local median household income. Other parts of California, many areas of Florida and the New York metropolitan area had home prices at least five times the median household income.
Some parts of New England, including the Boston area, also saw home prices five to eight times the median household income.
The survey also found that U.S. homeownership increased just 0.1 percent in 2023, which was the smallest increase since 2016. The survey found that a racial disparity in homeownership still exists, especially for Black families and Hispanics.
In the first quarter of 2024, the black homeownership rate was 46.6 percent, while the Hispanic homeownership rate was 49.9 percent. This is much lower than the white homeownership rate, which was 74 percent.
“Black families also face other disadvantages,” Daniel McCue, a senior research associate at the Center, said in a statement. “Whether it’s the high down payment or the monthly mortgage payment, the costs of buying a home have left homeownership out of reach for all but the most advantaged families.”
Rental prices also remain high in 2024, as they have increased 26% nationwide since the start of 2020. The survey also found that about half of renters spent more than 30% of their income on housing and utilities in 2022 .
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