The Challenge of Homeownership in the Face of Rising Mortgage Rates and Stagnant Incomes: How Employer-Assisted Housing Programs Can Help

Mortgage Interest Rates Soaring, Homeownership More Challenging for Average Americans

With mortgage interest rates crossing into 5.5 percent territory, homeownership for average Americans seems more challenging than ever. The cost of living is soaring, salaries are stagnant, and the nation’s housing supply is at an all-time low.

The rate of homeownership was just 38% in 2021 for people under 35, compared with nearly 45% before the Great Recession. In 2021, more than half of adults aged 18 to 24 lived in their parental home, as did 17% of adults aged 25 to 34.

Owning a place to lay a welcome mat remains a key component of the American Dream. Homeowners’ net worth was 44.5 times higher than that of renters in the latest Federal Reserve Survey of Consumer Finances in 2019.

Affordable housing is a key focus for government-sponsored entities, the Mortgage Bankers Association, and the current administration, with its plan to offer $15,000 of down payment assistance for eligible first-time buyers.

Employer-assisted housing (EAH) programs are emerging as a strong step in making housing truly accessible. Companies like Amazon and Walmart are offering housing assistance programs for their employees, including down payment grants or loans, counseling, and education.

These programs help increase available funding for affordable housing and benefit companies by improving recruitment and employee retention rates. Employers can encourage employees to stay put by offering housing incentives, leading to long-term benefits for both parties.

At a time when remote work is leading more workers to relocate while keeping their jobs, employers can use housing incentives to retain talent and build successful teams. By investing in their employees’ housing needs, companies can see a substantial return on investment and enjoy the benefits of a more engaged workforce.

Overall, the focus on affordable housing and employer-assisted programs is a positive step towards making homeownership more attainable for average Americans.