Home prices are high largely due to a long-term housing shortage—an issue stemming from decades of underbuilding.

Strict zoning laws and investor activity are also limiting supply and shaping the market.

A supply-driven feedback loop is keeping prices elevated as buyers and sellers stay on the sidelines.

Affordability is slowly improving, but homebuilding and supply need to increase for the market to return to life.

It’s not a stretch to say these are unprecedented times for the housing market. Home prices have surged nearly 20% over the past five years, hitting a record $409,000 in June 2026, while elevated mortgage rates and a shaky economy continue to complicate the picture.

The impact shows up in monthly costs. Elevated mortgage rates have pushed payments higher, while rising insurance, inflation, and property taxes are adding even more pressure.

These trends have created a slow and expensive housing market that overwhelmingly favors buyers—many of whom are staying on the sidelines. Homes are taking longer to sell, and many Americans can’t afford a starter home. More people are instead choosing to rent, which is now more affordable than buying in every major city, reshaping how people see the dream of homeownership.



So, why are houses so expensive? ... We break down three factors behind today’s record prices, where costs may be headed, and how buyers and sellers can navigate the market.

(10-10-2026 04:49 AM)BirdHawkEagle Wrote:  The answer is illegal immigration.

(10-09-2026 11:55 PM)Gitanole Wrote:  Why Are Houses So Expensive Right Now?
September 16, 2026 by Jamie Forbes

Home prices are high largely due to a long-term housing shortage—an issue stemming from decades of underbuilding.

Strict zoning laws and investor activity are also limiting supply and shaping the market.

A supply-driven feedback loop is keeping prices elevated as buyers and sellers stay on the sidelines.

Affordability is slowly improving, but homebuilding and supply need to increase for the market to return to life.

It’s not a stretch to say these are unprecedented times for the housing market. Home prices have surged nearly 20% over the past five years, hitting a record $409,000 in June 2026, while elevated mortgage rates and a shaky economy continue to complicate the picture.

The impact shows up in monthly costs. Elevated mortgage rates have pushed payments higher, while rising insurance, inflation, and property taxes are adding even more pressure.

These trends have created a slow and expensive housing market that overwhelmingly favors buyers—many of whom are staying on the sidelines. Homes are taking longer to sell, and many Americans can’t afford a starter home. More people are instead choosing to rent, which is now more affordable than buying in every major city, reshaping how people see the dream of homeownership.



So, why are houses so expensive? ... We break down three factors behind today’s record prices, where costs may be headed, and how buyers and sellers can navigate the market.

“It’s normal for house prices to rise slowly over time, but a decades-long inventory shortage, increasing economic uncertainty, and whiplash from the pandemic has made the current housing market historically slow and expensive. It will take a concerted political and industry-wide effort to close the supply gap, bring down costs to a ‘normal’ level, and make homeownership a viable and appealing option for more Americans.”
– Daryl Fairweather, Redfin Chief Economist

Topics

1. America has a severe housing shortage
2. Zoning laws have limited new construction
3. Investors own a larger share of homes

Will house prices fall in 2026?
How to buy and sell in an expensive housing market
Final thoughts

https://www.redfin.com/blog/why-are-houses-so-expensive/

(10-10-2026 10:52 AM)memtigbb Wrote:  Is there even a such thing as a "starter home" now? I remember a long time ago seeing neighborhoods being built that were "starter homes" that were like 900sq ft with a garage to make it look larger. I havent seen any built in a very very long time though. Which makes me believe they stopped building them because people stopped buying them. We have a problem now where kids want to move out of their parents house into something even bigger and better than their parents house. They dont want a 900sq ft house, they want a 3200 sq ft for their very first house but then cry because they cannot afford "500k" houses and all houses cost "500k" etc. They watch too much tik tok and think they are supposed to live in luxury at all times even without doing anything to earn it.

(10-10-2026 10:52 AM)memtigbb Wrote:  Is there even a such thing as a "starter home" now? I remember a long time ago seeing neighborhoods being built that were "starter homes" that were like 900sq ft with a garage to make it look larger. I havent seen any built in a very very long time though. Which makes me believe they stopped building them because people stopped buying them. We have a problem now where kids want to move out of their parents house into something even bigger and better than their parents house. They dont want a 900sq ft house, they want a 3200 sq ft for their very first house but then cry because they cannot afford "500k" houses and all houses cost "500k" etc. They watch too much tik tok and think they are supposed to live in luxury at all times even without doing anything to earn it.

(10-10-2026 01:16 PM)Tiger1983 Wrote:  One reason houses cost more than in the past is people’s expectations have increased.

For example (per Google):

• 1950 Home Size: About 983 to 1,000 square feet, typically featuring 2 bedrooms, 1 small bathroom, a compact kitchen, and a small or non-existent garage.

• Present Home Size: Around 2,200 to 2,400 square feet, typically featuring 3 to 4 bedrooms, 2.5+ bathrooms, an open-concept floor plan, a pantry, walk-in closets, and a 2-car garage.

My wife lived in a three bedroom home with one full bath (about 1,300 sq ft) with her parents and three siblings and no one considered it sub standard at the time.

I suspect enforcing immigration law will free up millions of units over time and thus increase supply and lower prices.

(10-10-2026 09:55 AM)bullet Wrote:  

(10-09-2026 11:55 PM)Gitanole Wrote:  Why Are Houses So Expensive Right Now?
September 16, 2026 by Jamie Forbes

Home prices are high largely due to a long-term housing shortage—an issue stemming from decades of underbuilding.

Strict zoning laws and investor activity are also limiting supply and shaping the market.

A supply-driven feedback loop is keeping prices elevated as buyers and sellers stay on the sidelines.

Affordability is slowly improving, but homebuilding and supply need to increase for the market to return to life.

It’s not a stretch to say these are unprecedented times for the housing market. Home prices have surged nearly 20% over the past five years, hitting a record $409,000 in June 2026, while elevated mortgage rates and a shaky economy continue to complicate the picture.

The impact shows up in monthly costs. Elevated mortgage rates have pushed payments higher, while rising insurance, inflation, and property taxes are adding even more pressure.

These trends have created a slow and expensive housing market that overwhelmingly favors buyers—many of whom are staying on the sidelines. Homes are taking longer to sell, and many Americans can’t afford a starter home. More people are instead choosing to rent, which is now more affordable than buying in every major city, reshaping how people see the dream of homeownership.



So, why are houses so expensive? ... We break down three factors behind today’s record prices, where costs may be headed, and how buyers and sellers can navigate the market.

“It’s normal for house prices to rise slowly over time, but a decades-long inventory shortage, increasing economic uncertainty, and whiplash from the pandemic has made the current housing market historically slow and expensive. It will take a concerted political and industry-wide effort to close the supply gap, bring down costs to a ‘normal’ level, and make homeownership a viable and appealing option for more Americans.”
– Daryl Fairweather, Redfin Chief Economist

Topics

1. America has a severe housing shortage
2. Zoning laws have limited new construction
3. Investors own a larger share of homes

Will house prices fall in 2026?
How to buy and sell in an expensive housing market
Final thoughts

https://www.redfin.com/blog/why-are-houses-so-expensive/

Environmental laws have also made it much more difficult to harvest wood. I know some people who do that. So that has driven up wood prices.

The supply disruptions caused by Covid drove up the prices of nearly everything. And the wars in Ukraine and Iran have driven up energy prices which impacts everything else. That is, of course, without even getting into the inflationary policies of the Biden administration and the Green policies whose goal is to converse energy by driving up energy prices.

But there is a differential. Fast growing areas like Houston and DFW don't have nearly the home inflation of California and New York which have strict zoning and development laws.