Why a Fed Rate Cut Won’t Solve the Housing Wealth Gap

The U.S. housing market is sharply divided between those who own and would-be buyers who can’t afford a home

The housing divide underscores the wealth gap between homeowners, who have benefited from several years of robust home-price appreciation, and renters, who are facing one of the least-affordable housing markets in decades.

Home prices have climbed more than 50% since 2019, helping homeowners build wealth. 

Homeowners with mortgages had $17.5 trillion in equity in July, according to Intercontinental Exchange.  

About 90% of homeowners with mortgages could borrow against some of the equity in their homes while keeping a cushion of 20% equity, according to ICE.

Nicole Friedman Wall Street Journal 14 September 2024

https://www.wsj.com/economy/housing/interest-rate-cut-housing-mortgage-prices-8c12464b