The term “house poor” refers to homeowners who spend a large portion of their income on housing costs. This can make it difficult to save money, pay for other expenses, or even afford a basic lifestyle. By most definitions, house poor families spend more than 30% of their monthly income on housing. Needless to say, households that have to devote this high of a percentage to their housing expenses have a much more difficult time affording other basic living expenses and saving money for other things. Across the country, an astounding 27.4% of Americans are considered to be house poor. However, according to the U.S. Chamber of Commerce, even more Americans are living beyond their means.
Factors contributing to more house poor Americans
- Rising home prices: Home prices have been on the rise in recent years, making it more expensive to buy a home. This is especially true in urban areas, where home prices have skyrocketed.
- Rising interest rates: Interest rates have also been on the rise, which has made it more expensive to finance a home purchase.
- Stagnant wages: Wages have not kept pace with the rising cost of housing, making it more difficult for homeowners to afford their monthly payments.
Top 10 cities for house poor Americans
Unfortunately, we have been seeing an increase in the prevalence of house poor Americans across the country. According to a recent analysis by the U.S. Chamber of Commerce, eight of the top ten house poor cities were in Florida and California. The top 10 cities were as follows:
- #1. Hialeah, FL
- #2. Los Angeles, CA
- #3. New York, NY
- #4. Miami, FL
- #5. Hollywood, FL
- #6. Honolulu, HI
- #7. Palmdale, CA
- #8. Fort Lauderdale, FL
- #9. Long Beach, CA
- #10. Oxnard, CA
The increasing number of house poor Americans is a cause for concern. This trend can lead to financial hardship, as homeowners may struggle to make their mortgage payments or afford other necessities. It can also lead to a decrease in home ownership rates, as people are priced out of the market. If you are considering buying a home, it is important to do your research and make sure that you can afford the monthly payments. You should also have a solid financial plan in place in case of unexpected expenses. By taking these steps, you can help to avoid becoming house poor.
Are you thinking about buying or selling a home in the South Florida market? We can help! Contact Natasha at Live South Florida Realty, Inc. today! Also, be sure to download our free Florida Home Search app for your smartphone or tablet.