Biden’s economy continues to sting. Equity in a home is nice for your net worth, but it doesn’t pay the bills every month. And as house values go up, so do all of the things associated with the price of the home (replacement value, repair costs, etc.).
As home prices soar, property owners are sitting on historic levels of home equity. The average homeowner’s equity has soared by $28,000 just over the past year — growing to an average of about $305,000, according to Corelogic.
But even many of those lucky homeowners are increasingly struggling with the rising costs of home insurance premiums, home repairs, and property taxes. And they can’t afford to move.
Lower-income, older people, and people of color are among the most vulnerable. Their options for moving or downsizing are increasingly limited with high mortgage rates and a scarcity of smaller, accessible homes.
The number of cost-burdened homeowners — those who spent more than 30% of their income on housing and utilities — rose by about three million people between 2019 and 2022. Most of this increase was among those who make less than $30,000 a year. A full 30% of Black and 28% of Hispanic homeowners are cost-burdened, compared to 21% of white homeowners, the Harvard report found.
“The all-in monthly costs of the median-priced home in the US are the highest since these data were first collected more than 30 years ago,” the Harvard report found.
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