One in 4 middle-income new homeowners — twice as many as a decade before — are buying into cost-burdened situations.
The share of middle-class Americans who are buying wallet-squeezing homes has more than doubled in the previous 10 years.
Almost 30% of middle-class homeowners bought homes with monthly payments costing more than 30% of their income in 2022, an NBC News analysis of Census Bureau data found. That’s more than twice the share from 2013, with experts warning it leaves many households with less money for groceries and emergencies and less able to get ahead in the future.
That “cost-burdened” benchmark — in which a household devotes over 30% of income to housing costs — is a widely used measure of affordability for both homeownership and renting. The Census Bureau measures housing costs against it, and the Department of Housing and Urban Development has used it for decades.
At least you roughly lock in a monthly rate. I was happy to not have 15% rent increases each year.
This is the real explanation. There is no more choice to rent a cheap apartment or buy an expensive house. You can live in a van maybe but that’s being outlawed in many states. My brother in law and his family are paying almost $2000/month for a shitty apartment built in the 1970s. I bet the same place will be $4000 in 10 years, and even shittier.