Are continually rising home prices making more homeowners feel “house poor?”
According to a survey from Consumer Affairs, 69% of homeowners feel house poor, defined as having “little left for savings after paying the mortgage and associated monthly expenses.” More than half (54%) said their housing expenses are their largest financial burden, while 40% said they are higher than they can comfortably afford and 35% deemed them too high overall. Around one-third (34%) said housing expenses are harder to afford than expected, 31% said they are higher than they anticipated and 27% said they are increasing over time. Single homeowners were more likely than dual-income homeowners to report feeling house poor, at 79% compared to 65%.
What is costing homeowners so much? Overall, regular repair costs, said 63%, and 60% said regular maintenance and upkeep costs. Nearly half (49%) said both homeowners insurance premiums and HOA or other association fees, while 40% said property tax increases. Other headaches for homeowners included property taxes, mortgage insurance premiums, significant repair costs, rate increases for insurance premiums, repairs not identified prior to purchase.
Forty-six percent of respondents are working another job to help afford housing costs, 41% are relying on dual income of the owners, 40% are working a second full-time job, 33% are dipping into savings, 22% are renting out a room and 15% are relying on credit cards and other debt. Sixty-two percent reported making sacrifices in housing-related expenses, 56% made sacrifices on nonessentials and 34% sacrificed non-housing essentials.
Despite these challenges, 87% of homeowners said they believe homeownership is worth it or a good long-term choice, 53% said it’s better than renting and owners feel optimistic. More than half (51%) said they are optimistic about their ability to pay monthly housing expenses, 50% are feeling positive about their long-term financial health, 49% feel optimistic about their general finances and 48% feel positive they will eventually pay off their mortgage.