There's a lot happening in the housing market and a recent American Enterprise Institute (AEI) podcast touched upon all those aspects that are currently impacting homebuyers as well as the larger market. Lynn Fisher, Resident Scholar and Co-director of AEI’s Center on Housing Markets and Finance discussed affordable housing and the current state of the markets spoke with AEI's Spencer Moore and Cecilia Gallogly about the market risks and the affordability crisis plaguing potential homebuyers.
"Home prices are exceeding the rate of wage growth," Fisher said while comparing the current market to the first five years of the last housing boom.
Touching upon the supply constraints and why more homes weren't being built, Fisher said that there was an excess of supply right after the bust, but that was absorbed by 2012 and while the reasons aren't exactly clear, while there was enough supply at the higher end and the lowest end of housing, it was middle-income housing where supply constraints were most acute. "The missing middle is the new interesting story," Fisher said.
Click here or the image below to hear the full podcast.