New reports are showing just how bad things have gotten under President Biden. While Americans have dealt with inflation before, this level of inflation mixed with poor job prospects (despite the claims of employers), and a lack of ability to stretch the budget any further is absolutely destroying the prospect of homeownership for most. Now, that prospect is pushed out even further by the idea of needing to make 34% more than last year, and that’s only if you’re lucky.
With inflation, skyrocketing housing prices, and increasing mortgage rates the average mortgage is requiring $76,414 to qualify for the $412,700 price. This signifies a $19,478 increase from last year, or 34.2% according to the data from Redfin. While this is a scary proposition for most people, this change in income also represents the yearly income for many people living in poverty. Let that sink in for a moment. To make the rate for a new mortgage you need to add in the pay of someone in poverty to afford a new house.
According to the Labor Department, the average worker is earning $1,037 a week or $53,924 annually. Unfortunately, the record-high $412,700 median home price represents a 17% increase over last year, and mortgage rates have shot up from 3% to just over 5%. These two statistics drove the mortgage from $1,423 last March to $1,910 last month. While buyers across the country are feeling this pinch, the sunbelt is feeling the strangle more than anyone else.
In Tampa, Florida, buyers are needing to make 48% more than last year to swing the average mortgage payment. In Phoenix, AZ, and Las Vegas, NV they are needing 45% more than last year. Considering the lack of economic growth in comparison to these changes in all three of these cities, the market is being inflated artificially by remote workers, and people paying cash when moving from places like LA, San Francisco, and NYC. Cash offers with no contingency, no inspections, and a nearly immediate closing makes the prospect of getting a mortgage offer accepted incredibly difficult.
While 10 other cities including Orlando and Jacksonville, Florida, as well as Austin, Fort Worth, and Dallas, Texas made the list, this is just a list of metro areas. Many smaller towns with built-up infrastructure are seeing booms in their pricing as well and with steeper increases. The idea of small-town living is exciting for many who made the move out of the bigger cities. They feel like they are doing something good by buying at the smaller markets, and from farm stands. Being away from the noise pollution and bright lights is relaxing for them.
As much as the left wants to push this blame away from Biden by claiming we already had a hot housing market, they are right. We did. We also didn’t have inflation like this or people doing anything they could to escape the democrat-controlled states. Each city listed is in a Republican-ran state. These states are drawing in the freedom lovers from the Democratic oppressed regions of the U.S.
Granted the transplants who are pushing up these prices do find themselves having a few problems. Many are arriving with the mindset of wanting to make a few changes. They seem to think their ideas from Democrat-controlled states will help make things better. The fact of the matter is the reason these states are so free and prosperous is that they failed to listen to the wants of Democrats. They wanted to keep their states free and open to people – aka, the polar opposite of the Democrats.