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Trapped in the housing/gas price sinkhole?

Posted by Scott Van Voorhis October 19, 2012 06:44 AM

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Here's a pretty alarming stat: Moderate-income homeowners in the Boston area are shelling out more than 57 percent of their paychecks on mortgage payments and filling up at the pump.

OK, Boston area renters have it a little better, at least relatively. They are sending just under half their pay to their landlords, local gas stations and the MBTA. What a bargain!

We are talking homeowners with a median family income of $55,575 and renters making just over $51,000.

Those are some of the findings of the latest survey from a pair of top housing market think tanks, the Center for Housing Policy and the Center for Neighborhood Technology.

The drop in housing prices since the housing bubble blew up, while helpful, has definitely not ushered in a golden age of housing affordability, whatever real estate boosters might argue.

Overall, housing and transportation costs have soared by 44 percent since 2000, outstripping pay, which has risen 25 percent for moderate income families during the same period.

In fact, the housing/gas price sinkhole has gotten worse, not better, since 2006, when housing prices began to plummet across the country, the housing research groups find.

Says Center for Housing Policy Executive Director Jeffrey Lubell:

Increased demand for rental housing combined with insufficient new production has raised rents, while households with blemished credit and existing homeowners with underwater mortgages have been unable to take advantage of lower home prices. Add in the higher transportation costs associated with higher gas prices, stagnant or slowly growing wages and the loss of income associated with layoffs and it's easy to see how Americans have lost ground.

Are you trapped in the housing/gas price sinkhole? And, if so, what's your escape plan?

This blog is not written or edited by or the Boston Globe.
The author is solely responsible for the content.

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Scott Van Voorhis is a freelance writer who specializes in real estate and business issues.

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