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Housing Affordability Squeeze Hitting Jacksonville

For rent sign
RICH PEDRONCELLI / ASSOCIATED PRESS FILE PHOTO
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A new analysis released Thursday forecasts that housing in Jacksonville will continue to get less affordable through the end of the year.

Jacksonville renters – on average – are more at risk  than homeowners of being thrust into a category known as “housing burdened,” which is generally defined as needing to devote 30% or more of income toward the cost of housing.

Average Jacksonville rent payments as a portion of income are forecast to rise from 27.8% in June to 28.4% by December, according to online reality company Zillow.

The picture is worse on a national level, where Zillow is forecasting rent payments as a portion of income to edge past 30% by December, rising to 30.2%

New and prospective homeowners are also feeling the squeeze, with average Jacksonville mortgage payments as a percent of income reaching 18.8% in June and forecast to rise to 20.6% by December.

"Strong demand and rising prices for homes are overwhelming the ability of low mortgage rates to keep monthly payments down," said Nicole Bachaud, Zillow economic data analyst in a news release. "As prices continue to outpace income gains, affordability constraints will start to slow home price growth."

There are signs that price growth is already slowing.

Redfin, also an online reality company, reported the median nationwide home-sale price decreased 0.2% to $362,750 from the four-week period ending July 25, ending a five-month streak of record-setting home prices.

"Although homes are much pricier than they were before the pandemic, homebuyers now have the benefit of very low mortgage rates and a little less competition than they faced earlier in the summer," said Redfin Chief Economist Daryl Fairweather in a news release.

Mortgage rates are back below 2.8%, a level that Redfin said hasn’t seen since the winter. If those trends continue, homebuying conditions would likely improve, according to Redfin.

Bill Bortzfield can be reached at bbortzfield@wjct.org or on Twitter at @BortzInJax.