As home prices continue to soar, a new study finds that in many areas, home prices are now far higher than the median household income.
New Research From Harvard University Joint Centre for Housing Research They found that the cost of a single-family home in 2023 will be about 4.9 times the median household income, putting homeownership out of reach for many families. Interactive Map This shows where the price-to-income ratio was highest and lowest last year.
In many areas of Southern California, the price of a single-family home was at least eight times the area’s median household income. In other parts of California, much of Florida, and the New York City metropolitan area, home prices were at least five times the median household income.
In some parts of New England, including the Boston area, home prices are five to eight times the median household income.
The study also found that the U.S. homeownership rate will grow by just 0.1% in 2023, the slowest growth rate since 2016. The study also found that racial disparities in homeownership rates remain, particularly for Black and Hispanic households.
In the first quarter of 2024, the black homeownership rate was 46.6% and the Hispanic homeownership rate was 49.9%, both much lower than the white homeownership rate, which was 74%.
“Families of color face other disadvantages as well,” Danielle McCue, a senior fellow at the center, said in a statement. “The costs of buying a home, including higher down payments and monthly mortgage payments, put homeownership out of reach for all but the most advantaged.”
Rents have also risen 26% nationwide since the beginning of 2020 and are set to remain high into 2024. The survey also found that roughly half of renters will spend more than 30% of their income on housing and utilities in 2022.
