By TIPP EDITORIAL BOARD, TIPP Insights
Homeownership is a big part of most people’s American Dream. But that aspiration is becoming more and more elusive in Biden’s America.
The Fed is battling the 12.8%Â Bidenflation, an outcome of the President’s fiscal profligacy and the Fed’s monetary policy.
Americans are paying for it. The housing sector is one of its main casualties.
Mortgage rates have increased for ten straight weeks, climbing to 7.16% last week, the highest since 2001. It is erasing Americans’ ability to buy a home.
ADVERTISEMENTThe median home price in the U.S. is now $454,900.
The mortgage rate was 3.45% in January this year. With a 20% down payment, the monthly principal & interest payment would be $1,624.
Fast forward to this week. The payment at the current rate of 7.16% is $2,460. That’s an increase of 51.5%.
The $2,460 is the monthly mortgage payment and goes to the lender. It does not include local taxes, insurance, etc. The total mortgage payment for the year is $29,520.
ADVERTISEMENTTo qualify for a mortgage, the borrower’s income must be at least four times of mortgage payment. That means, the qualifying income for an average home is $118,080 a year.
Compare it to the median annual household income of $78,075. The qualifying income is 51% higher than the median household income. Most Americans won’t qualify to buy a new home in the foreseeable future!
Aside from qualifying for a mortgage, the 20% down payment is another major roadblock that makes housing unaffordable.
To get financing to buy an average home, the buyer has to put 20% down payment which amounts to around $90,980. That’s $12,900 more than the median family income.
The down payment is a tall order for many in the current environment.
ADVERTISEMENTMost Americans say that their wages have not kept pace with Bidenflation. U.S. real average weekly earnings, measured year-over-year, have been in the negative territory for eighteen months.
The incomes are stagnant. But due to inflation, expenses are increasing. How do Americans make up? They have to either cut expenses or borrow money or save less.
The data suggest that all three are happening. According to a recent TIPP Poll, Americans are slashing expenses in many ways.
ADVERTISEMENT
The borrowing has hit an all-time high. Americans now owe $923 billion in credit card debt.
Americans’ saving rate is in free fall. It hit 3.7%, the lowest since 2008.
President Biden recently held ice cream in one hand and touted the economy’s strength. It was reminiscent of Marie Antoinette of “Let them eat cake” fame.
He is more worried about the midterm elections next week than America’s debt, which has crossed over 31 trillion dollars. He promises that the student loan checks will be on their way in the next two weeks. Rest assured, that’s likely to worsen inflation and make the Fed’s job even more challenging.
In summary, most Americans won’t qualify for mortgages and don’t have the down payment to buy a home. Thanks to Bidenomics, first-time buyers must abandon or put their American Dream of owning a home on hold until things get better.
READ MORE BY TIPP INSIGHTS
- ‘Swampy and wrong’: Conservatives torch GOP colleagues for backroom deal protecting Epstein-linked Dem - November 19, 2025
- ‘This is Jill sticking the shiv’: Biden raises eyebrows when he gives credit to Kamala for economic policy - August 16, 2024
- Damning new ad slamming ‘Chief Weirdo Tim Walz’ launches same time as blistering new nickname - August 6, 2024
Comment
We have no tolerance for comments containing violence, racism, profanity, vulgarity, doxing, or discourteous behavior. If a comment is spam, instead of replying to it please click the ∨ icon below and to the right of that comment. Thank you for partnering with us to maintain fruitful conversation.