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MortgagePoint » Your Trusted Source for Mortgage Banking and Servicing News 76 February 2025 J O U R N A L still a shortage of homes for sale. New listings fell 1.6% month over month on a seasonally adjusted basis and declined 1.5% year over year. Meanwhile, active listings, a mea- sure of all homes on the market, fell a slight 0.3% month over month—the first decline on a seasonally adjusted basis in five months. They rose 7% year over year, but that was the smallest annual increase in nearly a year. One reason active listings are rising is that some homes are taking a long time to sell, causing stale supply to pile up. A Regional Look • Median sale prices rose most from a year earlier in Cleveland, Ohio (15%); Milwaukee (14.5%); and Phil- adelphia (14%). They rose the least in three Florida metros, including Tampa (0.5%); Orlando (1.3%); and Jacksonville (1.3%). • Pending sales rose most in Ana- heim, California (9.7%); Phoenix (9.4%); and New Brunswick, New Jersey (6.9%), and fell the most in Newark, New Jersey (-12.5%); New York (-9.3%); and Orlando (-9.1%). • Closed home sales rose the most in San Diego (28.4%); San Jose (25.8%); and Anaheim (24%). They fell in three metros: West Palm Beach, Florida (-9.8%); Fort Lauderdale (-3.5%); and Detroit (-1.3%). • New listings rose most in San Francisco (26.8%); Oakland, (21.1%); and Anaheim (16%). They fell most in San Antonio (-16.8%); Newark (-10.6%); and Austin, Texas (-10.2%). • Active listings rose the most in Cin- cinnati, Ohio (37.3%); Fort Lauder- dale (33%); and San Diego (26.3%). They fell most in Newark, New Jersey (-9.5%); San Francisco (-5.1%); and San Antonio (-3.3%). • In Newark, 60.5% of homes sold above their final list price, the high- est share among the metros Redfin analyzed. Next came San Jose (52.1%); and Nassau County, New York (50.9%). The lowest shares were reported in West Palm Beach, Florida (6%); Miami (6.9%); and Fort Lauderdale, Florida (9%). RECORD NUMBER OF RENTERS STRUGGLE WITH AFFORDABILITY A ffordability challenges for renters reached unprecedent- ed levels in 2023, as the num- ber of cost-burdened households hit a record high of 22.6 million, according to the latest data from the American Community Survey analyzed by the Harvard Joint Center for Housing Stud- ies. Among these households, 12.1 mil- lion were severely burdened, spending more than 50% of their income on rent and utilities. These figures highlight a worsening crisis that continues to affect renters across all income levels. Cost Burdens Climb Across the Board In 2023, half of all renter house- holds were cost-burdened, a rate that has remained steady since 2021 but marks a 3.2 percentage point increase from pre-pandemic levels. This trend represents a sharp rise from 2001 when 41% of renters were cost-burdened. No- tably, the number of severely burdened households has surged by 2.2 million since 2019 and by 7.8 million since 2001. Lower-income households continue to bear the brunt of the affordability crisis, with 83% of renters earning less than $30,000 classified as cost-bur- dened. However, middle-income renters are experiencing the fastest increases in cost burdens. In 2023, 70% of renters earning between $30,000 and $44,999 were burdened, up 15 percentage points from 2001. Even households earning more than $75,000 have not been im- mune, with 13% now cost-burdened—a rise of 7.8 percentage points since 2001. Residual Incomes Hit Record Lows The crisis has left many renters with little money for other expens- es. Among households earning less than $30,000, residual incomes—the amount left after paying rent and utilities—plummeted to a record low of $250 in 2023, a 55% decline since 2001. Over the same period, median rents for this group rose 18% while incomes fell 12%, all adjusted for inf lation. For mid- dle-income renters, residual incomes have declined by about 10% since 2001, while higher-income households have seen little to no change. Erosion of Affordable Housing The diminishing supply of afford- able rental units has compounded the problem. Since 2013, the number of units renting for less than $1,000 per month (adjusted for inf lation) has declined by 7.5 million. Meanwhile, the stock of higher-cost units has ballooned, with rentals priced above $1,400 growing by nearly 10.5 million. These shifts have forced lower-income renters into higher-priced housing, further exacerbating their financial struggles. Employment and Income Trends Exacerbate the Crisis Full-time work is no longer a reliable safeguard against housing cost burdens. In 2023, 36% of fully employed renters were cost-burdened, up from under 25% in 2001. Workers in personal care services and food preparation face the highest-burden rates, with over half spending more than 30% of their income on rent. Even renters in higher-paying fields like office admin- istration and education are increasingly affected, with burden rates of 42% and 38%, respectively. Lower-income households have been hit particularly hard. Since 2001, the share of income these renters allo- cate to housing has jumped from 60% to 80%. This increase has significantly reduced their ability to cover other essential expenses, driving many into financial precarity.