Report: It's Getting Harder and Harder to Become a Homeowner RealtyTrac found that home price growth exceeded wage growth in nearly two thirds of the nation's housing markets so far this year.

This story originally appeared on Reuters

Shutterstock.com

Home prices are rising faster than wages in most of the United States, making homeownership increasingly difficult for average Americans in some of the most populous areas of the country, according to a report released on Thursday.

The report found that home price growth exceeded wage growth in nearly two thirds of the nation's housing markets so far this year, with urban centers like San Francisco and New York City among the least affordable.

Home prices in 9 percent of the U.S. housing market are now less affordable than their historic norms, the report by RealtyTrac found. Home buyers need to spend more of their incomes on housing, leaving less money for other purchases.

"While the vast majority of housing markets are still affordable by their own historic standards, home prices are floating out of reach for average wage earners in a growing number of U.S. housing markets," said Daren Blomquist, senior vice president at RealtyTrac, which monitors housing market trends.

RealtyTrac parsed homes sales and income data in 456 U.S. counties with a combined population of 221 million.

The report comes after data showing house flipping, buying and selling a house to make a quick profit in a hot housing market, had risen to record levels in some markets, generating concerns of a price bubble.

While the latest report could fuel those concerns, prices are still far more affordable than during the peak of the housing bubble in 2006. In the first quarter of this year the average wage earner needed to spend a third of their income on monthly mortgage payments compared to more than half in 2006.

In addition, RealtyTrac's affordability measure, which compares house prices to wages, was above historic norms in 99 percent of housing markets in 2006. After the housing bubble burst that fell to a low of 2 percent in 2012 before rising to its current 9 percent.

Still, prices in highly sought after housing markets leave average wage earners far behind, RealtyTrac said.

For example, to buy a median priced home in various areas of New York City, Brooklyn and Manhattan especially, or in the San Francisco metro area, a buyer needs to spend between 120 percent and 95 percent of the average wage on mortgage payments.

Among populous areas where the growth in house prices outstripped wage growth were Los Angles, Phoenix and San Diego.

(Reporting by Edward Krudy; Editing by Daniel Bases and Tom Brown)

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Business News

'Now Accepting Applications': Elon Musk Is Opening a New Preschool in Texas Called Ad Astra. Here's How to Apply.

The school got an official permit last month to operate with as many as 21 students.

Business Ideas

63 Small Business Ideas to Start in 2024

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2024.

Business News

'We're Not Allowed to Own Bitcoin': Crypto Price Drops After U.S. Federal Reserve Head Makes Surprising Statement

Fed Chair Jerome Powell's comments on Bitcoin and rate cuts have rattled cryptocurrency investors.

Business Ideas

Is Your Business Healthy? Why Every Entrepreneur Needs To Do These 3 Checkups Every Year

You can't plan for the new year until you complete these checkups.

Business News

A New Hampshire City Was Named the Hottest Housing Market in the U.S. This Year. Here's the Top 10 for 2024.

Zillow released its annual lists featuring the top housing markets, small towns, coastal cities, and geographic regions. Here's a look at the top real estate markets and towns in 2024.