Home prices in Chicago have risen three times faster than incomes since the turn of the century, which has made home ownership an impossibility for more Americans than ever before.
In many bigger cities, home prices have outpaced income. In Miami, for example, incomes have gone up 16 percent, while home prices have increased 58 percent since early 1998. New York's Long Island suburbs have seen just a 14 percent rise in incomes as compared to an 81 percent increase in home prices. Boston home prices have gone up 89 percent, while incomes have increased only 22 percent.
Even with a downturn in the real estate market looming on the horizon, home sales are still headed for another record year.
The first sector to show slowing is the high-end home market. Because of “overpersonalized” big-ticket properties, the pace of house auctions nationwide has surged.
Low interest rates are the only continuing positive trend of the housing market. Low rates average now less than 6 percent for 30-year fixed-rate loans, the lowest since the 1960s.
Real-estate analysts believe that if the housing market stalls, some areas will continue to grow modestly while other markets gradually go soft, rather than pop.