Housing Affordability Crisis Hits Swing States Ahead of 2024 Election

The surge in housing costs has made homeownership increasingly unattainable for many Americans, particularly in key battleground states that could influence the 2024 presidential election. A recent report from Redfin reveals that the median monthly housing payment for homebuyers in these swing states has reached an unprecedented $2,161, marking a staggering 92% increase since the 2020 election. Home prices in these areas have also soared nearly 40% over the past four years, now averaging $316,063. The report highlights seven critical swing states: Arizona, Nevada, Wisconsin, Michigan, Pennsylvania, Georgia, and North Carolina. For the typical resident in these states, the rising costs have rendered median-priced homes unaffordable. A household earning the median income of approximately $79,155 would need to allocate 32.8% of their earnings to housing, a significant jump from the 21.8% required in 2020. Several factors contribute to this affordability crisis, including years of underbuilding that have led to a housing shortage, compounded by rising mortgage rates and expensive construction materials. The current high mortgage rates have also created a "golden handcuff" effect, where homeowners with low rates are hesitant to sell, further constraining the housing supply. Economists anticipate that mortgage rates will remain high throughout most of 2024, with potential declines only occurring once the Federal Reserve begins to cut rates. As of this week, the average rate on a 30-year mortgage stands at 6.77%, while available home supply has plummeted by 34.3% compared to pre-pandemic levels, according to Realtor.com.