The rising cost of homeownership has become a major concern in recent times, fueled further by the economic policies pursued by President Biden’s administration. Economic data suggests that ‘Bidenomics’ is exacerbating the situation, making it increasingly challenging for Americans to afford a house. According to the UK’s Daily Mail, the Average American now needs to earn an eye-watering $115,000 annually to purchase a median-sized home, compared to $99,342 last year.
Redfin, a real estate company, reveals that prospective homebuyers need a salary of $114,627, a 15 percent increase from the previous year and a staggering 50 percent rise since the start of the pandemic.
The current income requirement for buying a house exceeds the average household income by about $40,000. As per the most recent US Census Bureau data available, the average worker’s salary stood at $75,000 in 2022.
While hourly wages have seen a 5 percent hike over the past year, this increase is insufficient to keep up with the surging housing costs. Not only are housing prices rising substantially year over year, but the availability of affordable housing is also diminishing significantly.
Data from Redfin indicates that the median sale price of a US home in August was around $420,000, showing a 3 percent increase from the previous year. This figure falls just short of the all-time high reached in mid-2022.
Around a decade ago, in August 2012, Americans needed an annual income of less than $52,000 to afford a median-priced home. Redfin defines ‘median’ based on approximately 30 percent of annual income.
Amidst skyrocketing housing costs, interest rates have also experienced a significant surge during the Bidenomics era, now averaging around 7.7 percent. The Federal Reserve began raising rates last year to combat historically high inflation rates resulting from increased federal spending under the Biden administration.
Economists argue that this surge in inflationary pressure can be attributed to the substantial trillions spent by Biden and the Democrat-led Congress.
Higher mortgage rates would ideally discourage demand and lower home prices, helping balance out the additional interest payments. However, the current situation is not following this trend. Despite a slight increase in new listings, housing inventory remains at record lows as homeowners hold onto their low mortgage rates, thus supporting the inflated prices. Consequently, buyers, especially first-timers, are encouraged to think outside the box when considering homeownership.
One option is to consider purchasing a condo or townhouse, which tend to be less expensive than single-family homes. Alternatively, moving to a more affordable part of the country or opting for a more affordable suburb can also be a viable choice.
As home prices and interest rates continue to soar, it becomes increasingly evident that the economy and inflation are among the primary concerns for voters as the 2024 elections approach. These worrying trends do not bode well for President Biden.
Recent polls have revealed a notable decline in President Joe Biden’s approval ratings, with an increasing number of Americans from both parties holding him and his policies responsible for persistent high inflation, leading to rising food and gas prices along with broader concerns about the state of the U.S. economy.
MSNBC’s ‘Morning Joe’ co-host, Joe Scarborough, expressed astonishment at the ‘unbelievable’ poll results and highlighted the Republican Party’s capability to capitalize on these crucial voter issues.
In fact, recent polling by Gallup demonstrated the largest gap between Republicans and Democrats since the initiation of these surveys. MSNBC analyst and ‘Way Too Early’ host Jonathan Lemire cautioned that these polls should serve as prominent warning signs for President Biden and the Democratic Party as a whole.
He cited a Marquette University poll that indicated former President Donald Trump had a substantial lead, ranging from 23 to 24 points, over Biden in terms of handling inflation, the economy, and the border. Trump also boasted a 19-point advantage in voters’ confidence in his ability to create jobs.
These remarkable numbers significantly favoring Trump serve as a stark warning for Biden and his administration. While Democrats have a predominant advantage concerning climate change and abortion, elections are frequently decided based on the state of the economy. As such, these statistics present significant challenges for the incumbent administration.
It is important to address the growing concerns surrounding the affordability of housing and the rising inflation rates that impact the American populace. Identifying viable solutions and implementing effective policies to tackle these issues head-on is of utmost importance.
Only through prudent decision-making and thoughtful economic measures can we alleviate the burdens faced by Americans and ensure a brighter future for the nation as a whole.