See Why Lower Mortgage Rates Aren’t Enough to Make Homes Affordable, in Charts: Many hopeful buyers need more than lower rates to afford a house by Veronica Dagher of The WSJ. Excerpts:
"Homeowners with low mortgage rates and a lot of equity feel little pressure to sell, which is keeping inventory low in some regions. Rising costs for home insurance and property taxes in many places are making matters worse."
"The most affordable starter homes, especially in the tight markets of the Northeast and Midwest, still often see intense bidding and rapid price appreciation, said Hannah Jones, senior analyst at Realtor.com, which is operated by News Corp, parent of The Wall Street Journal.
In New York, home prices have more than doubled over the past nine years, reflecting the state’s chronic shortage of inventory. By contrast, prices have climbed about 33% in Texas over the same period, thanks in part to more building, she said."
So where they are not building much, prices are up more than 100% in the past 9 years. Where they are building it is only up 33%, a difference of at least 67 percentage points.
The CPI was 34.5% higher in Sept. 2025 than it was in Sept. 2016. So Texas home prices are just about unchanged after inflation is taken into account. But in New York, home prices are up at least three times as much as the CPI.
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