FORTUNE -- The wealth of Americans reached a nominal record high during the summer, the Federal Reserve reported Monday. Driven largely by surging stock prices and rising home values, net worth in the U.S. rose 2.6% to $77.3 trillion from July through September. That represents the highest level since such records started to be kept in 1945.
This is positive news, but likely only for the richest Americans. The improvement masks the fact that wealth is unevenly distributed among the affluent, who tend to own stocks. For most less-affluent Americans, their biggest asset is their home. And while property prices have been recovering, many homeowners were disproportionately hurt by the 2007 crash of the housing market; it may be a while before they feel any wealthier.
Just take a look at the market for rentals: It used to be that those who couldn't afford to buy would rent. Now, however, more Americans are finding that renting isn't a more affordable alternative, according to a study released Monday by the Joint Center for Housing Studies of Harvard University.
A shortage of apartments, especially cheap ones, has been an ongoing problem for years. The recession made it worse, as record foreclosures led to an increased demand for rentals of an already limited pool of properties, driving prices even higher. Demand also came from many who couldn't get approved for a mortgage, as banks tightened lending standards.
True, the housing crash created a glut of empty homes ripe for renting. Remarkably, however, "soaring demand was more than enough to absorb the 2.7 million single-family homes that flooded into the rental market after 2007," the study found.
Add to that more than a decade's worth of stagnant incomes, and it's easy to see why New York City political activist Jimmy McMillan proclaimed during the state's 2010 governor's race (over and over, mind you), "The rent is too damn high."
In 1960, about one in four renters nationwide spent more than 30% of their income on housing, the traditional measure of affordability. Today, one in two are cost-burdened.
The squeeze has been felt most by renters who make less than $15,000 a year. But middle-income Americans make up the biggest increase among renters feeling the pinch. The share of cost-burdened renters with incomes between $30,000 and $44,999 was 44 % in 2011, up 11 percentage points from 2001. And the share with incomes of $45,000 to 74,999 was 19%, up 9 percentage points during the same period.
"Incomes just aren't keeping up," says Eric Belsky, director of Harvard's joint center for housing studies. He adds the trend will get worse in the coming years before it gets better.
Throughout the economic recovery, housing experts thought higher prices for rentals was a positive sign. The hope was that renting would eventually become too expensive and it would make more financial sense to buy. While that might be true, and new home sales have been rising, it's hard to see how many more renters can sock up enough savings for a down payment to buy when more are spending a bigger share of their income on rent.
Renters are missing out on one of the cheapest times to buy. And as more are finding it harder to pay rent, they're missing out on years of building equity for themselves and their families.
Where are the bankers involved with JPMorgan's dubious mortgage deals? At JPMorgan, Goldman Sachs, and other Wall Street firms.Stephen Gandel, senior editor - Nov 27, 2013 5:00 AM ET
More than 80% of mortgage applications are for 30-year fixed-rate mortgages. They are critical to a healthy housing market.
FORTUNE -- As Washington talks about the future of mortgage finance giants Freddie Mac and Fannie Mae, some are asking if Americans should continue having easy access to a popular mortgage -- the 30-year, fixed-rate home loan.
It has been around for decades. Banks typically don't like to hold onto the risks of these MORENin-Hai Tseng, Writer - Sep 25, 2013 8:49 AM ET
More good news for the housing market, as people now prioritize the mortgage bill ahead of car loan and credit cards.
FORTUNE -- In another sign the U.S. housing market is recovering, financially distressed borrowers are starting to make their mortgage payments before their credit cards bills -- a near reversal of a trend that emerged after the housing market crashed.
It's a positive development, reflecting the rebound in U.S. home prices MORENin-Hai Tseng, Writer - Sep 19, 2013 10:20 AM ET
There are plenty of unanswered questions around the potential unwinding of Fannie Mae and Freddie Mac, but one thing is certain: It will cost homebuyers more to get a mortgage.
FORTUNE – Efforts to wind down the government's support of America's biggest mortgage companies are gaining traction; the question now is how much more could it cost homebuyers if Congress scales down Freddie Mac and Fannie Mae, or ends the companies MORENin-Hai Tseng, Writer - Aug 8, 2013 5:00 AM ET
U.S. home prices may not rise as fast as they had been, but take it as a sign of normal.
FORTUNE – For many months now, U.S. home prices have risen to new highs as the housing market recovers from one of the worst crashes in recent history. The rebound comes as more Americans find jobs and as homebuyers work their way through the remaining housing inventory following years of lackluster MORENin-Hai Tseng, Writer - Jun 28, 2013 5:00 AM ET
History tells us a gradual rise in interest rates won't likely deter homebuyers.
FORTUNE – U.S. Federal Reserve Chairman Ben Bernanke's speech Wednesday will likely push mortgage rates higher in the coming months. The central bank isn't going to raise interest rates soon, he assured, but if the economy continues improving the way it has, it will consider trimming its monthly bond purchases from the current level of $85 billion by the MORENin-Hai Tseng, Writer - Jun 20, 2013 10:36 AM ET
Another major source of bank profits is on the rocks.
FORTUNE -- Have you called your mortgage broker in a while? If you haven't, you should. And you'll probably get her on the first ring. Being a mortgage broker has suddenly become a lot lonelier.
The number of people looking to refinance their home loan has plummeted recently. According to the Mortgage Bankers Association, the number of borrowers filing refinance applications fell MOREStephen Gandel, senior editor - Jun 7, 2013 6:00 AM ET
At a confab of big money managers, the hottest topic was the home loan market. Scared yet?
FORTUNE -- In less than five years, mortgages have gone from toxic to tonic.
It's the same life span as the annual hedge fund conference SALT, where many of the top professional managers met last week to talk investments, hear speeches from luminaries like Al Pacino, and generally have a good time. In all, Las MOREStephen Gandel, senior editor - May 13, 2013 7:00 AM ET
It was another good quarter for banks, but they're not quite fixed.
FORTUNE -- The credit crunch may be over, but we are crawling our way out.
After rising for all of last year, bank lending dropped in the first three months of the year, according to FDIC data compiled by bank research firm Bankregdata.com. The drop comes as low interest rates are squeezing how much money banks can make from their MOREStephen Gandel, senior editor - May 8, 2013 7:00 AM ET
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