00:00It's Benzinga, bringing Wall Street to Main Street.
00:02U.S. housing affordability remains near its worst level since the global financial crisis
00:06as high mortgage rates, a shortage of homes, and weak income growth keep the market effectively
00:11frozen. In the latest episode of J.P. Morgan's All Into Account Global Cross-Asset Strategy
00:16podcast, John Simm, head of Securitized Products Research, and other J.P. Morgan analysts
00:21discussed mounting pressures on U.S. housing affordability. Simm said buying a median-priced
00:26home now costs a renter roughly 50% of median income, compared with 20% to 25% for existing
00:32mortgage holders locked into lower rates. About 75% of borrowers have mortgage rates below
00:385%, limiting mobility and housing supply. Mortgage purchase applications have fallen to their
00:43lowest level since 1995. Simm said high construction and labor costs, rising insurance premiums, and
00:49property taxes are adding to housing affordability pressures. Over the past 25 years, median household
00:55income has grown at an annualized rate of 0.4%, compared with 1.7% for home prices and 2
01:02% for rents.
01:02For all things money, visit Benzinga.com.
