This Is Why Homes Are So Unaffordable.

I went down the rabbit hole, so you don’t have to.

1. The biggest reason IMO is Zoning laws, and regulations. They make it difficult for builders to build homes quickly, and make it more difficult to build starter homes. This is a regional issue, Texas has less of these.

2. Investors buying up homes. Hedge funds and landlords.

3. Tariffs on Canadian lumber, our main source of lumber.

4. Shortage of construction workers

5. COVID. Because of Covid the federal reserve lowered mortgage rates to stimulate the economy. Everyone with 3% rates and below do not want to sell their homes, Because there monthly mortgage payment would go up a lot because of the current rates. Preventing a lot of these homes from being listed on the market and being sold. It’s unlikely we see rates this low again unless there is another economic crisis.

6. Current interest rates, 7.08% rates (per mortgage news daily) are still below the all time average slightly. But with higher home prices and higher rates that makes buying a home very unaffordable.

7. Flippers. They buy homes, fix them up, and relist them. If they overpay on the home and repairs, the arv doesn’t match up to the market. And it’s overpriced, nobodys is going to buy it. Not a whole lot of people doing this, but still another house that’s not on the market.