Housing in America has never been this unaffordable. The pandemic set off skyrocketing prices; then the Fed began to rapidly increase interest rates, pushing up borrowing costs. Many predicted this might result in a crash. But after dropping 10% from all-time highs, home prices in America are picking up again. What is going on?
On this week’s podcast, hosts Alice Fulwood, Tom Lee-Devlin and Mike Bird ask if anything can take the heat out of the American housing market. Skylar Olsen, chief economist at property app Zillow, tells them that interest rate rises have added $800 a month to the typical American household’s mortgage bill. And Domonic Purviance from the Federal Reserve Bank of Atlanta explains how central bankers are thinking about the impact on the affordability of those loans.