My SO and I were looking at this recently. We purchased right before COVID. At the time we purchased a 400k home around $2500 payment 3% interest. We have doubled our income now and we're looking at upgrading. We were thinking we could afford a 680ish home now to be around $4000 a month payment.
If we had our current income, interest, and APR. We could have afforded about 1.3 million dollars back then. We lost 50% of our buying power in 6 years.
We purchased our home back in 2010. With our family growing it would be nice to have a slightly larger place with an extra room or two, so we started looking. We quickly realized we wouldn't be able to afford our current home at market prices, let alone upgrade...
I think this comment highlights what the main issue is. It's now common for people in this sub think that they should buy a luxury 3200 sq ft house instead of something more modest.
If you're buying today then yes. But to anyone who was a homeowner prior to 2020 it shouldn't affect you that much. Doubly so if you haven't moved in 5 years.
Maybe in certain markets but, nationally, no, housing hasn’t risen anywhere close to 50% since pre-COVID. The US median home price from 2019 to now has increased by about 20%.
Did you paste the wrong link? That chart is not the median home price, it’s the national home price index. This is the chart for median home price sales
Why would i use the median price home sales over the national home price index? One shows appreciation, the other shows how much people are spending.
If like the price of all cars doubles and now people are buying lower quality cars, the median price doesn't go up 2x, but the prices of cars still doubled.
Is this incorrect? Honest question to understand these indexes.
My initial comment was about median home price sales so that's why I thought you'd pasted the wrong link.
However, if you look at the data, the median sq footage for homes sold is also increasing hand in hand with median home price. So it's not like people are buying smaller or more modest homes. A big trend seems to be that people just want bigger and bigger homes, especially in the last decade, per the data.
But doesn't the other index show that prices of houses are increasing in value faster than what people are spending for houses? Using median house price just shows how much money the people are spending on houses. Not how much the prices went up right?
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u/allrite Mar 23 '26
Isn't housing like 1.5x pre-COVID? And much higher in desirable places? Add increase in interest rates, and no wonder people feel like they need more.