Red-Hot Home Prices Freeze Out Lower Earners
Renters making less than $60,000 a year feel the likelihood they will ever own a house slipping away.
More and more lower-wage earners are feeling homeownership slip out of their grasp.
Photographer: David Paul Morris/Bloomberg
If there were any doubts about the toxic effects of turbocharged home price appreciation, new survey data from the Federal Reserve Bank of New York should put them to rest. According to the bank’s 2022 SCE Housing Survey, renters making less than $60,000 a year assign just a 33.5% average probability of ever owning a primary residence, the lowest since the survey question began in 2015 and down from 41.3% last year. Lower-income U.S. residents are losing faith that they can tap into the real estate market, the top driver of household wealth.
It’s not that they don’t want to buy a home, of course. According to the survey, 65.5% of those same renters would “prefer” or “strongly prefer” to own if they had the resources, and 67.5% think that housing in their area is a “somewhat good” or “very good” investment. But the homeownership dream simply seems to have gotten out of reach.