Most Americans witnessed their rent increase over the last year, due to high inflation and other economic conditions.
People are now afraid that they cannot afford rising housing costs.
“The surge in rents that took place over the last 12 months has created even greater housing uncertainty for the most vulnerable renters,” Kevin Palmer, head of Freddie Mac Multifamily, said in a news release. “Our survey shows that the national housing affordability crisis is worsening and that inflation is a key driver.”
A poll by Freddie Mac (the Federal Home Loan Mortgage Corporation) found that 62% of Americans are somewhat or very concerned about being able to afford their housing. The data from the poll showed that 69% of Americans are concerned about rising housing costs in general and 58% of renters have seen a price hike in the past year. Nearly one in five (19%) people who experienced a rent increase admitted they are now extremely likely to miss a payment, while 38% said they are somewhat likely.
Nevada is ranked eighth in the top 10 states with the steepest one-bedroom rent increases since the start of the pandemic, according to U.S. News & World Report. On average, the state saw a 33.26% rise in one-bedroom rent prices from March 2020 to June 2022 and as of June, Nevada’s average monthly rent is $1,186 for a one-bedroom unit.
A Wall Street Journal report said that housing in the U.S. was more expensive in June than it has been for any month in more than 30 years. The National Association of Realtors’ housing-affordability index was 98.5 in June – its lowest point since June 1989, when it was 98.3. The index takes into account mortgage rates, what single-family homes are selling for, and family incomes.
“Consumer sentiment toward the housing market has worsened alongside affordability,” The Wall Street Journal noted.
Fannie Mae (the Federal National Mortgage Association) surveyed consumers in July and found that only 17% of Americans said it was a good time to buy a home, compared to 28% a year ago, according to The Wall Street Journal. The number of people who think now is a good time to sell a home fell to 67% from 75% last year.
Existing home sales have fallen for five consecutive months, The Wall Street Journal reported. Potential buyers are concerned that they may be priced out of the housing market as interest rates and home prices continue to climb. The current housing market is at one of the lowest points of affordability in recent decades.
The Bureau of Labor Statistics (BLS) on Aug. 10 released the Consumer Price Index (CPI) data for the 12 months ending in July. The data showed an 8.5% all-items annual increase; some of the largest contributors were increases in the index for food, shelter, and electricity.
