Middle Class And First Homes

[Jun 12, 2008.]

 

The housing market is being none to kind to the middle class families. These families were the ones to buy homes during the housing boom that lasted from 2001 to 2005.

As the mortgage collapse took effect these families were also the ones to feel the worse of the impact. Now, as a new group of families start to enter into the middle class they find that buying their first home to be harder then ever before.

This fact is not due to the middle class making less then previous generations but because mortgages and loans are becoming harder and harder to locate. This is thanks, in large part to the current credit crunch which has affected all areas of the economy.

Even with home prices reaching all time lows, families are still unable to comfortably afford their first home.

This comes as a devastating blow to those middle class families who so desperately want to achieve the American Dream. Currently, families can afford rent, groceries, insurance, and bills which leaves very little for savings.

There are in fact, several factors that make the American dream just that, a dream. Rising fuel and energy prices, a weakening credit industry, and the risk for inflation are all making it impossible for the middle class to purchase a home.

In an effort to combat this, families are resorting to high interest loans and mortgages that are sure to reset at a higher interest rate. The result of this will be foreclosure and a strong possibility of bankruptcy.

Middle class families need to realize the change of the times and adjust what they feel is the American dream.

Living beyond your means is certainly not a viable solution to this problem since many feel that the reliance on credit cards has helped to entrench the economy in the current quagmire.