US Housing Affordability Hits Worst Level in Nearly Four Decades As Bidenomics Hurts Middle Class And Low Wage Workers (REAL Home Price Growth Declining As Bank Deposit Growth Remains Negative)

Confounded Interest ^ | 08/18/2023 | Anthony B. Sanders

[Kaiser8408a]

A surge in borrowing costs is making home purchases more expensive with little relief in sight. Courtesy of The Federal Reserve rate hikes to repress inflation … caused by excessive monetary stimulus and Federal spending.

But REAL home price growth (Case-Shiller National HPI YoY – Core CPI YoY) has been declining as The Fed helped jack up mortgage rates above 7%. REAL home price growth was last reported as -5.8% YoY.

The source of funding for mortgage lending is bank deposits. But bank deposit growth remains negative, along with M2 Money growth.

What has Bidenomics and The Fed brought us? DECLINING REAL home price growth as bank deposit growth has stalled.

Let’s see what The Fed does.

[Kaiser8408a]

bidenomics at work!

[joma89]

Massive inflation is all part of the democrat communist party’s plan to bankrupt the country.

[Alberta's Child]

I have no interest in defending Joe Biden, but massive inflation is the inevitable progression of events in a country where people think they have a God-given right to a standard of living they can’t afford.

[joma89]

I agree and that is why I said it was the democrat communist party’s plan and that party includes all its useful idiot voters.

[Alberta's Child]

Unfortunately it goes beyond Democratic idiots.

Over the course of the last five years here on FR you’d see completely conflicting complaints from many posters — who are clamoring for higher interest rates on their bank savings accounts, while complaining about rising mortgage rates.

As if they have some kind of God-given right to borrow money at 3% from the same bank that pays them 5% on their savings.

Financial ignorance abounds even among so-called “conservatives.”

[Macoozie]

The housing problem is two fold.
Lots of those middle level jobs no longer exist.
Folks making 100k are getting fired quickly these days. And not replaced.

The other part is the concentration of investment from globalization/financialization.
Good jobs are packed in areas. The rest of the country is empty.

The money, the jobs, the housing are all balled up.

Cheap housing somewhere? Probably no work available

Sky high home prices? Lots of jobs.

The middle is gone.

We started getting it back, MAGA style, but the system couldn’t allow it to continue.

[unixfox]

Those first time home buyers that voted RAT are getting everything they deserve. No sympathy.

[FLT-bird]

I would like to buy a house right now....but I refuse to buy with both sky high prices and high interest rates. I know several others who have reached the same conclusion. Let home prices come back down to where they were in 2019 or at least within viewing distance of that and then I’ll buy. For example, where I live home prices went up 66% in two years and have barely given any of that back since then. Prices need to drop by about 1/3rd to make me look seriously.

[EVO X]

You make a good point. Mortgage rates took a steep climb just recently. Sellers are still expecting top dollar while buyers only have so much for their monthly payment.