Would you like to buy a crumbling shack for $2m? Well then, you’re in luck, because that just about sums up the state of the housing market right now. Housing, particularly in places with a decent job market, has become increasingly unaffordable in the US. That’s partly thanks to quantitative easing during the pandemic, which supercharged housing inflation. The median American home price in January was $418,000, about a 45% increase from $289,000 five years ago, per Redfin data. Wages haven’t gone up at the same rate, and housing prices compared to income have reached an all-time high.
In post-pandemic America, there are three groups of people. First, there are those who own their home outright and those who bought a house before the pandemic, then refinanced during the historically low interest rates we saw in 2020 and 2021. Many of those homeowners are now sitting on large piles of equity.
