A new study from real estate investor Kinloch Partners, LLC, the limited availability of entry-level homes is preventing many people from enjoying the American Dream of homeownership.
Some regions of the country have it worse than others do, but most would-be homebuyers are facing a lack of affordability at the low end of the market.
According to the United States Census Bureau, the average price for a newly constructed home in March 2016 was $356,200.00. Median household income in 2016 is $53,657.00, or 15 percent of the average new home price.
In 1986, the average new-home price was $111,900.00, while median household income was $24,887.00, or 22 percent of household income.
Clearly, home affordability has suffered.
The Kinloch Partners said that even rental properties tend to cater to the high-end customer. In Atlanta, for example, 91 percent of multi-family housing projects were aimed at high-end customers in 2015.
America’s changing demographic trends dictate that something has to change.
The Millennial generation is now 74.9 million strong, and outnumber the Baby Boomers. These young adults are driving increased demand for affordable, entry-level homes.
It’s time that builders and developers paid more attention to this market.