Affordability is the new real estate buzzword.
The last two years the inventory shortage that has impacted the market has ultimately driven prices over the last 30 months to hit all-time highs. In addition to making it somewhat lucrative for sellers of homes, the rise in prices has made buying a home more expensive, entering the realm of unaffordability. According to a recent report published by the National Association of Home Builders, 48.7% of all homes are characterized as being within the financial reach of a middle-class family; that means that nearly 52% of all homes sold are out of the financial reach of average Americans.
Does this represent a bubble or a logjam? Home builders are still reluctant to jump into the home building frenzy with abandon because of the collapse of the market back in 2007 and 2008. In addition the supply chain issues that are impacting car dealerships and computers are also affecting supplies necessary for construction projects. This is only going to contribute to the inventory shortage as well as the escalation in prices not only for existing homes but also new construction. According to the NAHB, every time a mortgage rate climbs a quarter of a percent, approximately 1.3 million American households are priced out of the real estate market.
These sort of financial currents are impacting families in terms of where they can afford to live. Right now the study conducted by National Association of Home Builders indicates that Lansing, Michigan; Indianapolis, Indiana; Scranton, Pennsylvania; Rochester, New York and Dayton, Ohio happened to be places where first-time home buyers can enter into the market without jeopardizing their financial base.
The Most Affordable Places to Live in New Jersey
According to an article in Extra Space, these are the most affordable places to live in New Jersey:
■ New Brunswick
■ Pompton Lakes
■ Toms River