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--:-- Sean Rameswaram: Welcome to Today Explained. I'm Sean Rameswaram.
--:-- Noel King: And I'm Noel King.
--:-- Sean Rameswaram: Today, we're talking about the housing market. It's bonkers right now. Jerusalem Demasis is our Vox policy reporter who's been covering this story. Jerusalem, thanks for joining us.
--:-- Jerusalem Demasis: Thanks for having me.
--:-- Sean Rameswaram: So, the median housing price in America is around $350,000. A year ago, it was $300,000. That's a pretty big jump. What's going on?
--:-- Jerusalem Demasis: Yeah, it's crazy. We've seen a record low in housing supply. The Urban Institute found that we've dipped below two months supply. That means if there were no new homes on the market in two months, we would completely run out of homes to sell in the United States.
--:-- Noel King: That's wild. And I've heard stories about people waiving inspection fees and buying houses without even seeing them. Is that true?
--:-- Jerusalem Demasis: Yeah, it's all kind of a reflection of just how crazy the competition is right now. People are scrambling to find homes.
--:-- Sean Rameswaram: And where are all these houses being sold? Are they just in one area?
--:-- Jerusalem Demasis: No, it's all over the country. Houses are being sold at a higher rate than we've seen in a long time, whether you're in suburban America, rural America, or urban America.
--:-- Noel King: Okay, so I want to ask a question from a listener. Jordy from Raleigh, North Carolina, Sacramento, California, and Baltimore, Maryland, called in and said, "I'm calling from a small town in eastern Washington state called Pullman. My wife and I have been trying to buy a house literally anywhere. Everything is ridiculously overpriced. And there's just, I don't see how we're going to be able to buy a house before our lease is up at our current apartment."
--:-- Sean Rameswaram: Yeah, that's a common story right now. Jordy, thanks for sharing that.
--:-- Noel King: Jerusalem, what's going on with the housing market in Austin, Texas? I've heard it's one of the hottest markets right now.
--:-- Jerusalem Demasis: Yeah, that's true. Home prices in Austin are up more than 18 percent in the last year. We've seen an influx of tech workers from Silicon Valley and other parts of California.
--:-- Sean Rameswaram: Okay, so it sounds like the pandemic has changed the way people are looking at housing. Some people are moving to the suburbs, and others are moving to smaller towns.
--:-- Jerusalem Demasis: Yeah, that's right. People have been moving into the suburbs of the places they were already living in. And what's extra wild about this is that it's all happening during a pandemic, when you'd think people would maybe be trying to avoid going to random houses.
--:-- Noel King: That's a good point. And I've heard that the pandemic has also affected the lumber market, which is affecting the cost of building homes.
--:-- Jerusalem Demasis: Yeah, that's true. There's a lumber shortage right now, which is increasing the price of building materials.
--:-- Sean Rameswaram: Okay, so let's talk about the K-shaped recovery. I think that's a term that's been thrown around a lot lately. Can you explain what that means?
--:-- Jerusalem Demasis: Yeah, the K-shaped recovery refers to the fact that the pandemic has had a differential impact on lower-income and higher-income Americans. Higher-income folks are able to take advantage of low interest rates and low mortgage rates to buy homes, while lower-income Americans are facing higher rents and are struggling to make ends meet.
--:-- Noel King: That's a really important point. And I think it's worth noting that the pandemic has also changed the way people work. With remote work becoming more common, maybe people will be able to live in more affordable areas.
--:-- Jerusalem Demasis: Yeah, that's possible. But it really depends on how widespread remote work remains. There's a National Bureau of Economic Research report that found about 37 percent of American jobs can be conducted remotely. Whether they will be is a whole nother story.
--:-- Sean Rameswaram: Okay, so let's talk about the idea of the American dream. Is it still possible for people to achieve that dream of owning a home?
--:-- Jerusalem Demasis: Yeah, that's a really good question. The biggest thing that can be done is to reform local zoning laws. These laws dictate whether or not you will ever be able to afford a home or even afford rent in the place where your job is.
--:-- Noel King: That's a really interesting point. And I think it's worth noting that the government could play a role in making housing more affordable.
--:-- Jerusalem Demasis: Yeah, that's right. The government could provide incentives for builders to build more affordable housing, or they could provide subsidies for people who are struggling to make ends meet.
--:-- Sean Rameswaram: Okay, so let's talk about some listener questions. We had a question from Abhinav and Moshika Guha, who said, "We've placed seven offers and been outbid every single time. We're looking at every possible way to sweeten the deal."
--:-- Jerusalem Demasis: Yeah, that's a really common story right now. People are trying to do whatever it takes to get into the housing market.
--:-- Noel King: Okay, so let's talk about the idea of the white picket fence. Is that still a desirable thing?
--:-- Jerusalem Demasis: Yeah, that's a really good question. I think the idea of the white picket fence is still a desirable thing for many people. But maybe we should be thinking about what that means in terms of affordability and accessibility.
--:-- Sean Rameswaram: Okay, so let's talk about some listener comments. We had a comment from Wendy, who said, "I work from home and I'm from Des Moines, Iowa. I was able to take advantage of low interest rates and buy a home. But I feel guilty about it because I know that many people are struggling to make ends meet."
--:-- Jerusalem Demasis: Yeah, that's a really common feeling right now. People are feeling guilty about being able to take advantage of the housing market while others are struggling.
--:-- Noel King: Okay, so let's talk about some listener questions. We had a question from Brandon Lovers, who said, "My husband and I are trying to buy a house, but we're struggling to make ends meet. We're worried that we'll never be able to afford a home."
--:-- Jerusalem Demasis: Yeah, that's a really common story right now. People are struggling to make ends meet and are worried about being able to afford a home.
--:-- Sean Rameswaram: Okay, so let's talk about some listener comments. We had a comment from Courtney, who said, "We were able to put in an offer and be accepted on a small house in a town 20 minutes outside of Pullman. But it feels weird because we didn't think we'd be able to afford a house for another couple years."
--:-- Jerusalem Demasis: Yeah, that's a really interesting point. People are feeling weird about being able to afford a home right now.
--:-- Noel King: Okay, so let's wrap up. Jerusalem, thanks for joining us today.
--:-- Jerusalem Demasis: Thanks for having me.
--:-- Sean Rameswaram: And thanks to all our listeners for tuning in. If you have any questions or comments, please email us at [email address].
--:-- Noel King: And don't forget to subscribe to our podcast on Apple Podcasts or Spotify.
--:-- Sean Rameswaram: And if you want to support our show, please consider making a financial contribution to Vox.
--:-- Noel King: Thanks for listening.
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