Cost of buying a house is the highest in at least a decade, Redfin says

The cost of buying a house in the U.S. is the highest in at least a decade, real estate company Redfin said on Friday.

This is a result of the combination of higher mortgage rates, which have topped 7% for the first time for fixed 30-year home loans according to Freddie Mac, and higher home prices.

Redfin said that the median asking price for a home in the country reached a record $415,925 in the four weeks ended on April 1.

Moreover, the median home sale price also hit a record in April, at least since 2015: $383,727. The combination of sale prices and current mortgages has taken monthly payments to a record $2,843, a 13% increase from a year ago.

This has taken the average income that Americans must make in order to afford a home to at least $76,000, according to a recent CBS report, also based on figures from Redfin.

By comparison, only four years ago, people with annual earnings of $40,500 could afford a typical starter house, the online estate firm said in its report.

Redfin defines a home as affordable if a buyer spends no more than 30% of their income on housing, assuming a 3.5% down payment. Despite the $76,000 figure it reports, the typical full-time worker in the U.S. earns roughly $1,145 per week, or roughly $66,000, according to government labor data.

"The pandemic housing-market boom changed the definition of a starter home," Redfin Senior Economist Elijah de la Campa said in a statement. "A decade ago, many people thought of a starter home as a small three-bedroom single-family house. Now that type of home could cost seven figures, especially in expensive parts of the country."

This report comes amid an all-time high figure of Latino homeowners.

Some 3.2 million Latino households became homeowners between 2012 and 2022, an increase of 5.4 percentage points that clocked in at 51.2% overall, a report by the National Association of Realtors said.

Nevertheless, affordability and inventory are a persisting challenge for Latinos.

According to the study, 37% of Hispanic and Asian homeowners spend more than 30% of their income on housing, indicating a considerable affordability challenge. Other hurdles for Latinos include securing a mortgage and dealing with other debts such as student loans.