Owning homes is quite unaffordable right now. Renting and owning used to be comparably expensive. Now, homeownership is 50% ![[Pasted image 20240605144635.png]] [Source: Goldman Sachs](https://www.goldmansachs.com/intelligence/pages/us-home-prices-forecast-to-climb-as-mortgage-rates-fall-in-2024.html) It's because mortgages have become twice as expensive *and* home prices have increased: ![[Pasted image 20240605094246.png]] [Source and data](https://lao.ca.gov/LAOEconTax/Article/Detail/793). Normally you would expect home prices to fall when interest rates increase, but that's not true because [[A majority of homeowners in 2024 have interest rates below 4 percent]]. Another classic measure of affordability is the percentage of median income required to own or rent the median home: ![[Pasted image 20240605152733.png]] There is also the ratio from prices to rents ([source: DataWrapper](https://datawrapper.dwcdn.net/ZGBxq/5/)): ![[Pasted image 20240605153524.png]] Analysis on the topic seems weirdly shallow (this page included). #Research Other resources: - [The Economist](https://archive.is/uPMaB#selection-1479.0-1494.0) on how mortgage payments used to be *cheaper* than rents, a concept nigh-unfathomable in the Bay Area