Higher home prices today serve as one of the main reasons many Americans find it harder to buy a house compared with in the 1950s.
The median sale price for a home in the country amounted to $285,700 in February. This represented an 8.8% increase year over year and marked the largest price growth since March 2014.
There are many factors to consider when trying to analyze why the current housing market has been tougher for many Americans than the situation during the 1950s.
Your average salary mostly determines how you could afford a home purchase through a conventional loan or financing from the Federal Housing Administration (FHA). A loan company today, however, has provided buyers with more options compared with the past 60 years.
A Trulia report based the difficulty of buying a house from a San Francisco-based teacher’s salary. While the average pay reaches more than $72,000, the median price for a house in the city is estimated at $1.61 million.
If you think that’s expensive, consider the $1.18 million average price in San Jose, California.
Home prices in San Jose rose at an annual rate of 34.1% in February, which outranked 72 other markets under Redfin’s coverage. If you own a house and plan to downsize, you might be tempted to do so given that the market seems to favor sellers.
However, the lack of supply caused relatively flat sales during the month. Only 166,100 houses exchanged possession, up 0.4% year over year, according to the report. Those who searched for homes in Seattle also had to make a decision pretty quickly. Listings go off the market within just eight days.
Higher home prices might convince you to rent a house instead. Still, take time to shop around for mortgage loans before finally searching for a good lease. Many companies offer competitive rates.