In this installment of Realty News, Tom Iovenitti talks about the causes and effects of the affordable housing drought which continues to face the US – particularly in states such as California, Hawaii, and Massachusetts.
Hello, everyone. I’m Tom Iovenitti with Benutech, Incorporated, makers of ReboGateway. This is Realty News, brought to you by ReboReports. Today’s news report is about how the US Housing market is growing out of the reach of some homebuyers. In 2014, income levels and the rising cost of housing in the US continues to push affordable housing out of the reach of the average consumer. This is especially true in states such as California, where the cost of living exceeds the incomes of workers. According to ABC News, which cited numbers from Coldwell Banker, states with the least affordable housing include California, Hawaii, and Massachusetts. ABC News notes the average listing price of homes in these states exceeds $400,000, with the average price in Hawaii exceeding $700,000. Now, the causes of the affordable housing drought in the US are attributable to multiple factors, including the wealth gap between the rich and the poor, declining wages, and increased competition from global economies. Automation at home and abroad is also causing a shortage of jobs, which is making it hard for the average employee to find work. As the real estate market continues to rebound from the worst financial crisis since the Great Depression, American families are finding it more and more difficult to save money for down payments. Although interest rates continued to remain low in 2014, they have the potential to rise in 2015 and 16, making home loans less affordable for the families. Subsidies, or subsidized housing, and other government programs are implemented in an effort to make housing more affordable for the low-income households. However, not everyone is in favor of these programs, which is making it difficult to fix the drought in the affordable housing area. Many Americans are coming to face with the reality that owning a home may not be in their future. However, this realization is contingent on the individual housing markets. ABC News notes that the states like Nebraska still offer buyers affordable housing options. As the dynamics of the global economy continue to fluctuate, so will the dynamics of the housing market. Buyers will have to adjust their lifestyles in order to survive. As always, stay tuned for the next week of Realty News and our updates. I’m Tom Iovenitti, bringing you this Rebo Report, and thanks for watching.