Marketplace has a new podcast for kids, "Million Bazillion!" EPISODE OUT NOW

Housing slumps, but homes still pricey

Steve Tripoli Jun 11, 2007
HTML EMBED:
COPY

Housing slumps, but homes still pricey

Steve Tripoli Jun 11, 2007
HTML EMBED:
COPY

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.

We’re here to help you navigate this changed world and economy.

Our mission at Marketplace is to raise the economic intelligence of the country. It’s a tough task, but it’s never been more important.

In the past year, we’ve seen record unemployment, stimulus bills, and reddit users influencing the stock market. Marketplace helps you understand it all, will fact-based, approachable, and unbiased reporting.

Generous support from listeners and readers is what powers our nonprofit news—and your donation today will help provide this essential service. For just $5/month, you can sustain independent journalism that keeps you and thousands of others informed.