Housing Market May Hit 'Breaking Point,' Economist Warns

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Homeownership is becoming less affordable for many due to high mortgage costs and elevated house prices.

High borrowing costs for home loans and rising home prices have made homebuying out of reach for huge swaths of Americans and is bringing the issue of housing affordability to a breaking point, according to a housing economist.Mortgage rates have soared to two-decade highs at the same time that house prices are at record levels, pushing a number of Americans out of the market while many others appear willing to wait it out.

One trend that's emerged that could provide some relief to buyers is the increased availability of homes priced between $200,000-$350,000. This segment of the market saw inventory jump by about 47 percent in May, surpassing all other homes on the market and was an increase from April. But buyers looking into acquiring these homes may have to sacrifice some size, according to Realtor.com.

 

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