Rising home prices and mortgage rates make homeownership less affordable, impacting renters and first-time buyers.

From Investing.com: 2025-07-01 01:22:00

Harvard’s Joint Center for Housing Studies released the 2025 update on “The State of the Nation’s Housing”, highlighting rising home prices and mortgage rates. The report shows that homeownership is becoming less affordable, with only 6 million of 46 million renters able to meet benchmarks. First-time homebuyers are older and more affluent, relying on friends and family for downpayments. Homeowner household growth has slowed, with an annual growth drop from 1.25 million to 613,000. The report also discusses the rising cost burden for renters and the need for more affordable housing options.

Rents are rising, leading to increased home prices. The report notes a lack of low-rent units, with a focus on higher-rent units in recent construction. Household formation has declined to around 1.2 million annually, mostly driven by immigration. The report acknowledges the temporary spike in household growth post-Great Recession, but predicts a decline in the next decade. Single-family rentals are on the rise, with concerns about investors impacting individual homebuyers.

Despite some concerns, the report provides valuable data on homelessness and local land use reforms, offering an annual review of American housing conditions.



Read more at Investing.com: The State of the Nation’s Housing 2025