As we move into the next decade; affording a home in 2020 isn’t expected to become much easier for the average American. A recent report by real estate research firm Attom Data Solutions revealed that in 344 of 486 counties (71% of the U.S average wage earner) can't afford to buy a home.
During the last three months of 2019, home prices rose 9% making cost for the typical home a "financial stretch for average wage earners, to cross the current national median home price of $257,000”. Currently, to purchase a home the average wage earner must have a gross income of $67,647; unfortunately, gross income for the average annual wage in the U.S. is $58,214.
Home Prices will climb in 2020
Although homes are a bit more affordable, prices are expected to keep climbing; another analysis from real estate site Zillow predicts home values will rise about 2.2% in 2020. According to a statement from the National Association of Home Builders. One reason for the tightening market is higher labor and land cost directly affects “underbuilding” of new housing stock.
Rents are Rising
Since the Great Recession, the state of unaffordable home sales is seen as one reason the number of people renting; a recent analysis from RentCafe report, since the housing collapse rent prices have risen 9.1% in the past decade.
Currently, 34% of Americans (more than 100 million people) are renting, the largest chunk of the U.S. population since the 1960s; however, renting isn't getting any cheaper. The national rent average rose to $1,473, up $390 (36%) in the past 10 years - that's faster than the rise in median income, up 27% in the past decade.
Homelessness is Rising
To worsen matters, the nation's homeless population is also rising, up 2.7%, the Associated Press recently reported, citing an annual count from January 2019 by the U.S. Department of Housing and Urban Development. It's the third consecutive rise in HUD's homeless projection for the U.S., driven largely by housing conditions in California, the AP noted.