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

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.

Comments

Mazzy I am Jobe Wed, 09/06/2017 - 18:00 Permalink

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.

In reply to by I am Jobe

nope-1004 TeamDepends Wed, 09/06/2017 - 18:16 Permalink

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. 

In reply to by TeamDepends

Manthong Creepy_Azz_Crackaah (not verified) Wed, 09/06/2017 - 18:36 Permalink

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 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.

In reply to by Creepy_Azz_Crackaah (not verified)

Creepy_Azz_Crackaah (not verified) Manthong Wed, 09/06/2017 - 18:40 Permalink

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.

In reply to by Manthong

cynicalskeptic Creepy_Azz_Crackaah (not verified) Wed, 09/06/2017 - 19:54 Permalink

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.  

In reply to by Creepy_Azz_Crackaah (not verified)

pynky01 nope-1004 Wed, 09/06/2017 - 19:03 Permalink

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... 

In reply to by nope-1004

Mazzy Wed, 09/06/2017 - 17:58 Permalink

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.

Mazzy Umh Wed, 09/06/2017 - 18:09 Permalink

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. 

In reply to by Umh

Creepy_Azz_Crackaah (not verified) Mazzy Wed, 09/06/2017 - 18:33 Permalink

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

In reply to by Mazzy

Rabbi Chaim Cohen Creepy_Azz_Crackaah (not verified) Thu, 09/07/2017 - 00:10 Permalink

Let's not forget the names for the same Plymouth colors:Dodge Name     Chrysler/Plymouth NamePlum Crazy        In-VioletBright Green      Rallye GreenSublime             Lime LightGreen Go           Sassy GrassGo Mango          Vitamin CButterscotch      Bahama YellowPanther Pink       Moulin RougeHemi Orange      Tor RedTop Banana        Lemon TwistCitron Yella         Curious Yellow

In reply to by Creepy_Azz_Crackaah (not verified)

canisdirus Mazzy Wed, 09/06/2017 - 18:14 Permalink

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.

In reply to by Mazzy

Anteater Wed, 09/06/2017 - 18:08 Permalink

STUDIO From $17171BR from $17572BR  from $2395A 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 Anteater Wed, 09/06/2017 - 18:20 Permalink

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.

In reply to by Anteater

itstippy Mazzy Wed, 09/06/2017 - 18:59 Permalink

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.

In reply to by Mazzy

EnragedUSMCExpat itstippy Wed, 09/06/2017 - 19:21 Permalink

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. FinneganUnited States Marine CorpsJakarta, Indonesiarsfinnegan@gmail.com

In reply to by itstippy

EnragedUSMCExpat Bigly Thu, 09/07/2017 - 03:35 Permalink

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.

In reply to by Bigly