Homeownership was once a cornerstone of the American dream. But for a growing share of the population, it is now more akin to a pipe dream. Within the last two years, real incomes have been crushed under the weight of historic inflation. At the same time, the Federal Reserve’s interest rate hikes have sent mortgage rates soaring.
With reduced buying power and increased borrowing costs, consumer interest in the real estate market has cooled. The number of existing home sales in the U.S. declined by 23% from April 2022 to April 2023, according to the National Association of Realtors. But while demand from home buyers has fallen, home prices have not. (These are the states with the worst housing shortages for low income Americans.)
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