Americans are forgoing meals in order to be able to afford housing. According to a recent survey by the real estate platform Redfin, 20 percent of Americans said they have skipped on food to put money towards their rent or mortgage instead. Over a third of respondents said they sacrificed vacations in order to keep up with their housing payments.
“Housing has become so financially burdensome in America that some families can no longer afford other essentials, including food and medical care, and have been forced to make major sacrifices, work overtime and ask others for money so they can cover their monthly costs,” said Chen Zhao, Redfin’s economics research lead.
The survey indicates that elevated mortgage rates, reaching an all-time high of 8 percent last year, have burdened American homeowners and potential buyers. Despite a slight decrease, these rates remain around the 7 percent mark. As a consequence, the median monthly mortgage payment rose to $2,700, marking an increase of more than 9 percent compared to a year ago. This rise in mortgage rates deterred prospective buyers from property purchases, increasing demands in the rental market and subsequently driving rent prices up as well.
Redfin reports a need for American buyers to earn a minimum of $114,000 to afford a typical American home, a significant leap from the median household income. The survey further highlighted the generational difference in financial coping strategies, with 13.5 percent of millennials and over a quarter of baby boomers dipping into their retirement savings to manage housing costs.
The Redfin survey reveals the extent to which Americans are struggling to survive in an economy governed by Bidenomics. The average rent for Americans has increased over 20 percent since Joe Biden took office.