{"id":232701,"date":"2024-06-15T13:29:39","date_gmt":"2024-06-15T13:29:39","guid":{"rendered":"https:\/\/michigandigitalnews.com\/index.php\/2024\/06\/15\/the-200000-starter-home-is-going-extinct\/"},"modified":"2025-06-25T17:17:00","modified_gmt":"2025-06-25T17:17:00","slug":"the-200000-starter-home-is-going-extinct","status":"publish","type":"post","link":"https:\/\/michigandigitalnews.com\/index.php\/2024\/06\/15\/the-200000-starter-home-is-going-extinct\/","title":{"rendered":"The $200,000 starter home is going extinct"},"content":{"rendered":"

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More than a year ago, Ali Wolf, Zonda\u2019s chief economist, told Fortune<\/em><\/a> the $300,000 starter home was going extinct. At the time, the housing data and consultancy firm found the share of projects under $300,000 was declining all across the country, and so was affordability.\u00a0<\/p>\n

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\u201cWe\u2019re creating, inadvertently, a renter society not because of choice but because of force,\u201d Wolf said. Rent isn\u2019t cheap either, even though some predict renting will be cheaper than buying<\/a> for years. Even so, in Wolf\u2019s mind, $300,000 homes should have been attainable. But everything from the cost of building materials to land availability to the lack of housing to regulation made it so much harder to build affordable homes\u2014and a lot of it stemmed from the pandemic-fueled housing boom.<\/p>\n

A Realtor.com report<\/a> released Thursday seemed to confirm the fall-off in the number of affordable homes. \u201cOver the past several years, the number of homes under $200,000 has gone from around half of all sales to less than a quarter of sales in 2023,\u201d it said, calling the statistic, \u201cstark proof of shrinking affordability across the country.\u201d\u00a0<\/p>\n

Affordability is shot, that\u2019s no secret; this is just one more indicator of that trend. Home prices skyrocketed during the pandemic: They\u2019re 45% higher now than they were before, according to<\/a> Zillow<\/a>, and the typical monthly mortgage payment is 115% higher since that time. And, since there\u2019s not enough homes to go around, prices haven\u2019t really fallen. (There are some metropolitan areas<\/a> where home prices have declined from a year earlier, but it\u2019s less than a handful\u2014nationally, home prices hit their ninth all-time high<\/a> in the past year). In any case, the median sales price of houses sold in the country is $420,800, and the average weekly 30-year fixed mortgage rate is 6.95%.\u00a0<\/p>\n

\u2018Where all the $200k homes are hiding\u2019\u00a0<\/strong><\/p>\n

There are some signs that home-price appreciation is slowing, and mortgage rates are coming down, but it might not feel fast enough for anyone who wants to buy a home. Still, Realtor.com analyzed listing data from the first week of this month and compiled a list of what it called \u201caffordability havens\u2026where all the $200k homes are hiding.\u201d Let me tell you, not a single one is in sunny California\u2014or even Texas, its cheaper, and sometimes more popular, counterpart.\u00a0<\/p>\n