LAS VEGAS, Nev. (FOX5) – The American Dream of homeownership has increasingly become out of reach for many families.
Data from Freddie Mac shows just how expensive it’s become to borrow money to buy a home. The 30-year fixed mortgage rate surged from 3.5 percent in March of 2020 to nearly 6.9 percent now.
Adding to the strain are higher home prices. The national average sale price is up from roughly $375,000 in early 2020 to more than $492,000 at the end of last year. Experts blame low supply and some are calling out corporate buyers who often swoop in with cash offers to take homes off the market.
Nevada Senator Jacky Rosen is proposing new legislation to go after corporate investors who she says are price gouging Nevadans and inflating costs in the housing market. It is called the HOME Act.
“Right now, we are at a dilemma in the state of Nevada. 10-15 years ago, you could buy a property in the low to mid $200′s, now the average cost is roughly over $400,000 and that is way too expensive for our residents here in Nevada,” contended Nevada Housing Coalition Executive Director Maurice Page. Page explained Nevada is in an affordable housing crisis.
“Let’s talk about those folks who are doing the hard work, our construction workers, our teachers. You have to have an average salary of $70,000 just to afford rent here in Nevada. That makes no sense. When you talk about what the American Dream is, they are not able to ascend to it,” Page reported. Page believes corporate ownership is exacerbating the problem. Wall Street is buying up hundreds of homes in Las Vegas and beyond, inflating prices, and pricing out families.
“The fact of the matter is you have these investors that are coming in with cash that can go way above the offering price. They can go $40k, $50k, even $100k over,” Page revealed.
“These corporate investors, they are not from here. They don’t care about community and roads and schools and all those things. They come in and buy up all these houses and then they just charge whatever the heck they want,” argued Rosen. Rosen says in Nevada, about 15 percent of the available home inventory has been bought up by corporate investors. Rosen’s HOME Act would direct the U.S. Department of Housing and Urban Development to investigate price manipulation by investors and make it illegal for anyone to rent or sell a unit during a housing crisis at an unreasonable level.
“People can come and invest, that is fine. What we are not going to let them do is price gouge people,” Rosen asserted.
Any fines collected from institutional investors for engaging in price gouging would be deposited into a fund for affordable housing for low-income families.
For full text of the “HOME Act” click here: https://www.govinfo.gov/content/pkg/BILLS-118s3561is/pdf/BILLS-118s3561is.pdf
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