patrick.net

Housing is sputtering. Home sales, home-building and homeownership have gone flat, and the rise in home prices threatens to stall out. Things aren't likely to get better soon, particularly for lower- and middle-income households struggling to make the rent and become homeowners. ...

Housing's travails appear incongruous with the red-hot job market. The economy is creating lots of jobs, unemployment is near a 50-year low, and job openings are at a record high.

Workers are demanding and getting bigger raises. In earlier times, when people had jobs, they bought and built homes. They became homeowners. So, what's wrong? ...

A 5 percent mortgage rate might not sound high, at least not to anyone over the age of 40. But rates have been so low for so long that most homeowners are now paying no more than 4 percent. It is too big a financial stretch for many to sell a home with a 4 percent mortgage and buy one with a 5 percent mortgage. ... Take the tax breaks away, and households can't afford as expensive a home, and house prices weaken. On cue, house prices are softening, especially in parts of the country where these tax deductions were most commonly relied on, including the East Coast, from Boston to Washington, plus South Florida, the Chicago area and the West Coast.