“Housing affordability is at the lowest level in history, which is widening the wealth gap—especially between generations,” Redfin deputy chief economist Taylor Marr said.
The recent report, which analyzed properties in the country’s 100 most populous metros, showed affordable listings hit a record low in 2022. The number of such listings fell by more than half from 2021.
“Many millennials were able to buy homes before or during the pandemic homebuying boom, but many others were priced out of homeownership and forced to keep renting,” Marr said.
Yelena Maleyev, an economist with KPMG, attributed the drop, which marked the biggest annual decline on Redfin’s record, to the “double pain” of high prices and high mortgage rates that has put a pinch on would-be buyers.
“That kind of double whammy, that double pain that folks are feeling, [is] keeping them essentially sidelined for longer … especially those who are maybe at the lower income level or the first-time buyer that can’t sell an existing home and use that money to buy that move-up home,” she said.
The analysis also uncovered stark racial disparities upon closer look at the affordability issue. More than a quarter of homes were considered affordable to the typical white household, compared to 9 percent for the typical Black household.
“Housing has become incredibly unaffordable for a lot of Americans, but Black families have been hit especially hard because they’re often less wealthy to begin with,” Redfin chief economist Daryl Fairweather said.
The analysis comes a day after another report released by the National Association of Realtors (NAR) showed the homeownership gap between Black and white buyers widened last year.
“Unfortunately, the incredible affordability challenges of the last year have hit minority home buyers more than White buyers,” Jessica Lautz, NAR deputy chief economist and vice president of research, said in a statement.
Read the full report at TheHill.com.
