Charted: How American Households Have Changed

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The Federal Reserve cuts interest rates by a quarter point after election. Here’s what that means for you link

• The Federal Reserve reduced its benchmark rate by 0.25%, following recent inflation easing toward the Fed’s 2% target. This is the second cut since September, marking a reversal from a previous cycle of rate hikes.

• Credit card rates, which rose from 16.34% to over 20% since early 2022, have seen minor relief with recent cuts. Consumers with credit card debt are advised to explore options like balance transfers or negotiate lower rates rather than waiting for further Fed cuts.

• Auto loan rates, now around 7%, remain high but could ease slightly due to competition and lender incentives. Trump's proposal to make car loan interest tax-deductible would require Congressional approval.

• Mortgage rates, still closely tied to Treasury yields, stand at 6.81% for a 30-year loan and are unlikely to drop significantly. Persistent investor caution keeps Treasury yields high, affecting mortgage rate stability.

• Federal student loans remain unaffected by the Fed’s rate cuts, though borrowers with variable-rate private loans could see minor reductions. Refinancing into fixed rates could provide relief, but federal loans offer safety features private loans lack.

There will be no boomer boom in housing supply in the near-term link

• Aging baby boomers are increasingly choosing to "age in place," reducing anticipated housing inventory growth over the next decade. This trend shifts earlier projections that 4 million homes annually would be available from older Americans selling or moving.

• Annual housing demand now exceeds supply by roughly 25 million units, with unmet demand expected to rise further. This demand increase is partly fueled by population growth and sustained homeownership among older adults.

• Higher home prices and mortgage rates discourage older homeowners from selling. Sentimental attachment also plays a role, with 29% of those over 55 reluctant to leave.

Florida Boom Metros See Biggest Drop in Home Prices Since 2011 link

• The Punta Gorda metro area experienced a 6.5% annual drop in median home prices to $350,000, while North Port-Sarasota-Bradenton saw a 5.8% decline to $485,000. Both declines are the steepest since 2011, reflecting increased inventory and lower demand.

• Rising home insurance costs, hurricane impacts, and increased supply have deterred buyers, according to local real estate experts. These challenges add financial strain, impacting confidence in Southwest Florida’s housing market recovery.

• Contrasting trends show Midwest markets like Racine, WI, and Youngstown, OH, with price hikes of 13.7% and 13.1% respectively, as affordability draws buyers. Nationwide, however, median home prices rose 3.1% annually, highlighting resilience in most markets despite Southeast price drops.

Here’s Where Minimum-Wage Workers Can Actually Afford Rent link

(A study found that people who earn low wages were rent-burdened in all of the country’s 50 largest real estate markets)

• In Buffalo, the most affordable city in the study, renters making the local minimum wage of $15/hour still spend 39% of their income on a one-bedroom costing $1,001 monthly. To meet the affordability threshold, Buffalo’s minimum wage would need to increase to $19.25/hour.

• In Atlanta, minimum-wage renters need 132% of their income to afford a typical one-bedroom at $1,653/month, with similar burdens in cities like Nashville and Charlotte. This highlights significant financial challenges for Southern renters.

• In New York City, where minimum wage is $16/hour, renters would still spend 84% of their income on a typical one-bedroom costing $2,330. High costs of living make affordable housing nearly unreachable in major urban areas.

Weekly Housing Trends —Data for Week Ending Nov. 2, 2024

• The median listing price has declined by 0.7% year-over-year, marking the 23rd consecutive week that prices match or are lower than the previous year. However, adjusting for a shift towards smaller homes, the price per square foot has risen by 1.8%.

• New listings increased 4.6% from the same time last year, but high mortgage rates discourage many sellers from listing as 84% hold loans with rates below 6%. Rate declines projected in upcoming months may boost both seller and buyer activity.

• Active inventory rose by 26.6% compared to last year, with total listings growing for the 52nd week straight. Homes stayed on the market eight days longer on average than in 2022 as buyers await more favorable market conditions.

Charted: How American Households Have Changed Over Time (1960-2023)

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Link to the listing

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