Housing Market Crisis

Housing market crisis deepens as high prices and locked-in rates stall sales

The housing industry is in a crisis, with sales decreasing but prices remain high. First-time buyers struggle to pay down the down payment and maintain 30-year rates at around 6.7%. Homeowners who lock in rates around 3% during the pandemic cannot afford to move their homes, contributing to the scarcity of supply. The cost of building materials is also increasing due to tariffs, energy to transport materials, and increased labor costs. Frank Holmes, CEO of U.S. Global Investors (www.USFunds), highlighted these issues in a new report. He highlighted affordability, with the median U.K. sales price at $407,730, a record for any July, and prices up over 2% year-over-year. Meanwhile, home equity lines of credit have risen to $459 billion, marking the highest amount since the end of 2017.