Here's How Many Americans Live In Houses They Can't Afford

Tyler Durden's picture

The U.S. Department of Housing and Urban Development suggests that you spend no more than 30% of your annual budget on housing costs as it could put you and your family at greater risk of being unable to afford other necessities.  That said, Americans are overachievers.

Per the following chart from howmuch.net, the average American family spends roughly $57,000 per year and have thrown caution to the wind with housing costs eating up nearly 33% of annual budgets.  In all, some 40 million houses (or about 1/3) are occupied by people who can't afford them.

 

Of course, this is hardly surprising in light of the following chart which reveals that the average working class family can't afford to live in the majority of metropolitan cities around the country due to ballooning housing costs.

 

Meanwhile, the following data from Harvard found that over 18 million households are currently stuck spending more than 50% of their annual income on housing, which is up 35% compared to 2001 levels.  Per Harvard Study:

The future course of homeownership will also be shaped by how affordable local home prices are for typical renters. On average, 45 percent of renters across the nation’s metropolitan areas can afford the payments on a median-priced home in their market area, but the shares range from less than one in ten in the high-cost markets concentrated on the Pacific Coast as well as in Florida and the Northeast, to two-thirds or more in low-cost metros in the Midwest and rural South. In areas where homebuying is well out of reach for a large majority of renters, there is much less potential for increases in homeownership.

 

With such large shares of households exceeding the traditional affordability standard, policymakers have increasingly focused their attention on the severely burdened (paying more than 50 percent of their incomes for housing). Although the total number of households with severe burdens also fell somewhat from 19.3 million in 2014 to 18.8 million in 2015, the improvement was again on the owner side (Figure 5). Indeed, 11.1 million renter households were severely cost burdened in 2015, a 3.7 million increase from 2001. By comparison, 7.6 million owners were severely burdened in 2015, up 1.1 million from 2001.

 

The share of renters with severe burdens varies widely across the nation’s 100 largest metros, ranging from a high of 35.4 percent in Miami to a low of 18.4 percent in El Paso. While most common in high-cost markets, renter cost burdens are also widespread in areas with moderate rents but relatively low incomes. Augusta is a case in point, where the severely cost-burdened share of renters was at 30.3 percent in 2015.

 

Of course, with the housing bubble re-inflating at breakneck speed and incomes stagnant, this crisis is only likely to worsen over time.

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
I am Jobe's picture

Murikans pretend about wealth. All a scam

Mazzy's picture

We pretend about a lot.  American "culture"?  We are truly debased.  Freedom? Only if you comply and don't step outside of the script too badly, though usually keeping your mouth shut will suffice for TPTB.  Our health? Haven't had it in half a century by and large.  Real wealth creation?  Much of it is a sham.

But hey, get rid of The Parasite and it all comes roaring back as our culture is reinvigorated.

TeamDepends's picture

And that parasite is communism aka the "New World Order".

nope-1004's picture

Banks lowering lending standards by lowering interest rates and qualifying standards is where the housing mess starts.  As a result, prices go sky high because low rates bring the otherwise 'unaffordable' folk into the mix, who unknowingly bid asset prices up.  Americans living in houses they can't afford is a direct result of BANKS.

This housing debacle is part of the overall picture of a dying financial system that the Fed created.

End the Fed and we end these idiotic asset bubbles and bank bailouts.  Ironically, the good citizen pays for both of those and bankers walk.

Time for street lamp decorating.

 

Creepy_Azz_Crackaah's picture

Agreed.

And they should go back to 20% down payment. Not many walk away from that.

Manthong's picture

 

The pisser is that county property taxes exceed the mortgage payment.

..butt even so… my home expenses for the half acre on the golf course are a fraction of the kids.

Creepy_Azz_Crackaah's picture

Yeah, that REALLY burns me up. When it's finally time to retire I might have to sell the home that my father and I built, and will have lived in for decades, becasue property taxes are so high.

My ultra-liberal, compassionate, county gubmint will throw me out on the street and sell my house to pay for outrageous gubmint union salaries and retirement.

Stuck on Zero's picture

If you've owned your home in coastal California for more than ten years you can't afford to live there.

waspwench's picture

But you can afford to leave, and leave in style.   :)))))

cynicalskeptic's picture

Bought a house at the bottom of the market at a bargain price.  Property taxes more than TRIPLED in 20 years. We paid the place off early, have no other debt.  

We'd been saving for our kids college since we got married - a decade before we HAD kids.  We were 'responsible' and waited until our student loans were paid off and felt relatively secure.     As a reward we got to pay the full price for college.

You do 'the right things' and you get screwed.

 

Saved for retirement but 401K's guarantee you get screwed.  Absolutely NO 'save' place to put your money and get any return on your savings.   Meanwhile inflation chews away at any savings you have.

 

How long before the state starts building euthanasia centers like in Soylent Green?

Saw that movie again yesterday.......   we're well on the way.  

Normalcy Bias's picture

...and somebody's gonna have to pay for those gold-plated gov't employee pensions and benefit packages!

Property taxes are headed nowhere but UP.

cynicalskeptic's picture

Thre's reasons that places that are cheap.   Too hot, too cold, no jobs, no doctors......

chemcounter's picture

It seems all those red areas also have a severe pension funding problem. Most of the green areas are financially sound and a nice place to raise a family. Enjoy your homeless, violence, earthquakes, hurricanes, wild fires and worst of all empowered liberals.

pynky01's picture

remove the jew and remove the problem... and as a bonus...world peace... take them out of our government our banks and our schools...these are the marxist jews from Russia that killed millions of Orthodox Christians, that declared war on Germany, let the moors into spain and were ran out of every country they fuked over... loaned money to bothsides of WWI WWII ...keep the bubbles going .. thanks Mr&Mrs Bumstein... 

guru69's picture

you don't know what you're talking about, racist turd

Swampster's picture

You sure showed him! ( that you are a sniveling, name calling coward)

massbytes's picture

I see Zerohedge has a "strict" discrimination policy.  Lets see if it real.  Report these racists and lets see if they get bounced.  This place is infested with them. Could be foreigners just stirring things up.  They do that you know.

squid's picture

I find it interesting that you got down owed for your post.

 

Still many brain-bleeched folks around the place.

 

Spielberg does not teach history, he teaches a narrative and until you get your head around that, you won't free your mind.

 

Squid

Common_Law's picture

Try humaworm for parasites. All natural ingredients

Saucy-Jack's picture

If someone is living beyond their means, they simply need a bigger credit line. Duh!

takeaction's picture

As one once said..."Get yourself some assets"  Bitchez

Mazzy's picture

How the hell is Transport 9k per year?  Our country has a problem, but I don't think it's transport.

And I think that "entertainment" blot needs to be widened significantly.  Do spinner rims count as entertainment....oh wait, I get it now, that falls under transport.  Modified exhausts, spoilers, and stroby ultra-obnoxia-brite headlights probably do too.

Umh's picture

Made up numbers, but buy a 50K automobile every 5 years and you'll beat 9K per year.

Mazzy's picture

Oh frick, I'm looking at all this through my frugal lens.  Silly me.

 

Side note: what's with all these 22-30 year old loser ass "bro types" driving neon green Dodge chargers?  Seems pretty faggy, and I'm hoping the trend is local and not a nationwide thing. 

Creepy_Azz_Crackaah's picture

Have you never heard of Hugger Orange (a 1969 Camaro color)? Dodge really did the bright colors back then. Purple, lime green, yellow, orange, pink.

1970 Dodge high performance colors:
Plum Crazy
Sublime
Go-Mango
Hemi Orange
Top Banana
Panther Pink
Green-Go

Xena fobe's picture

Cute.  I remember anti-establishment mint.  Ford, I think. 

Rabbi Chaim Cohen's picture

Let's not forget the names for the same Plymouth colors:

Dodge Name     Chrysler/Plymouth Name

Plum Crazy        In-Violet
Bright Green      Rallye Green
Sublime             Lime Light
Green Go           Sassy Grass
Go Mango          Vitamin C
Butterscotch      Bahama Yellow
Panther Pink       Moulin Rouge
Hemi Orange      Tor Red
Top Banana        Lemon Twist
Citron Yella         Curious Yellow

Falconsixone's picture

Yeah, and all the shit carefully designed to fail.

Xredsx's picture

Debt creation is not real money creation. Someone is not pouring money into the system but is sucking it out. Consumers must always have too much money spend if an economy is to thrive. 

canisdirus's picture

Cars are getting rather ridiculous in price. Average new car loans are $35k (after trade-ins and any down payments), which is something like $600-650/month on a 60-month loan with average credit. That's $7200, so you have ~$1800 left over for gas, upkeep, and related. It's not at all hard to see this, especially with the obsession with trucks and SUVs in the US.

Stuck on Zero's picture

$9K/year for transportation ... easy ...  four family members, four cars.

sacredfire's picture

Most of these statistics are pure bullshit.

Mazzy's picture

They forgot to include the cigarette and heroin budget.

I am Jobe's picture

Covered by Alimony. No point in having a family 

factorypreset's picture

What about the tat budget?  

raptor1100's picture

What about hookers and blow?

toady's picture

90% of statistics are made up.

Anteater's picture

STUDIO From $1717

1BR from $1757

2BR  from $2395

A 350SF 1BR apartment here would cost more than my SS!

I would have to give blood to have ramen and Pepsi to eat,

but then I would need MC every month for the blood loss.

Walking dogs could pay for the gas on my paid-cash-for car,

but why work to pay gas, if you can't afford to go anywhere?

Try flophouses!! Just 25% of my SS check with gigging work.

Yes my friends, flophouses for SS elderly solves the crisis,

and tent cities for those who haven't made it to SS yet.

We can do this, America! We're with you!! MAGA!!

itstippy's picture

The elderly need roomates, like young folks used to do straight out of High School.  Share expenses.  Use the same glass and Efferdent tablet to soak their dentures in, split the cabfare when they go to the food bank, buy the economy size bags of Old Roy and share them, that sort of thing.  Eight seniors will fit in a studio appartment if some of them sleep in chairs, which they're good at doing anyway.

Golden Age Flophouses are a good idea also.  It's that kind of creative solution that makes America great.

Mazzy's picture

We already have nursing homes, Mr. Itstippy.  What are you proposing?

itstippy's picture

I'm repling to Anteater's lament about high rental costs.  Nursing homes is not the topic; the high cost of housing's affect on independent elderly is.  We're brainstorming ideas on how seniors can cope with high housing costs and still live in dignity.  Communes, flophouses, and tents are current ideas.  Sleeping in cardboard boxes under bridges and on park benches wrapped in old newspapers are possible solutions also.

EnragedUSMCExpat's picture

You will not live long enough to see America descend to that point, mindless asswipe. You and your ilk are precisely the kind of immoral, parasitic coward filth that will be plowed under when the shit finally hits the fan - and sooner rather than later. 

WakeUpPeeeeeople's picture

Not sure if the orange groves can handle that much "fertilizer"

EnragedUSMCExpat's picture

Love to see the "Golden Age" flophouse you wind up in coward shitbag, you can share used Grampers with your fellow residents. We can still pull triggers sitting in chairs, and would relish the opportunituy to plug your diseased noggin between those empty running lights with a large caliber dose of hollow point lead. Fucking mewling, snivelling, bedwetting cunt. You and your parasitic ilk will be ERADICATED.

Robert S. Finnegan

United States Marine Corps

Jakarta, Indonesia

rsfinnegan@gmail.com

EnragedUSMCExpat's picture

Tough shit...dude. You and your fellow braindeads are about to be introduced to reality for the first time in your worthless, useless, pathetic excuses for wasted lives.

The gig is up, you no longer live in Blowbama's fantasyland and will meet a swift and decisive end in the real world.

Bigly's picture

That ain't Francis...

EnragedUSMCExpat's picture

Fuckin' A right it ain't. And while I am 10,000 miles away there are a shitload of individuals in your neighborhoods dedicated to your eradication.

It's coming as surely as the sun rises in the East, so by all means enjoy the short time you have left before reality makes it's terminal appearance in what has been your useless, worthless, wasted excuses for lives.