Housing slumps, but homes still pricey
For Sale by Owner sign
SCOTT JAGOW: A closely-watched annual report on the housing market comes out today. We're not expecting much that's new — the housing market's in a rut, we know that. But for many people, that's not making homes any more affordable. Steve Tripoli has more.
STEVE TRIPOLI: Despite a sales slump, 2.3 million additional U.S. households joined a category of those with high housing costs in 2006. Nicholas Retsinas of the Joint Center for Housing Studies at Harvard led the research.
NICHOLAS RETSINAS: It is a very significant bump. We're still seeing that disconnect between wages and housing prices.
Retsinas says stagnating wages, a growing number of house-hungry families and regional supply constraints keep prices out of reach for many. He says the affordability challenge could have ripple effects.
RETSINAS: It could also undermine economic competitiveness for a region.
That's because high housing costs drive workers to demand higher wages.
RETSINAS: And particularly in a global economy, that can make certain businesses, certain sectors, uncompetitive.
Despite all this, the report predicts that growing immigration and high-end household wealth will keep spending on housing robust through the next eight years — but only after the oversupply from the building boom clears up.
I'm Steve Tripoli for Marketplace.