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Wednesday, April 24, 2024

Home loan installment in USA increases 77% in a year

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Many people in the USA have stopped thinking about their dream of buying a new house because of the country’s Central Bank-Federal Reserve constantly hiking the interest rates. Banks and other financial organizations are offering loans at an interest rate of 7.25%, because of which, the monthly installment of a home-loan worth 4.40 crore rupees has turned to more than 3 lakh rupees. More than 11 crore people who live in rented houses have been trapped in vicious cycles.

The pandemic had increased the demand for new houses, which led to an increase in rents, and inflation has shot up as well. In order to deal with inflation, the Federal Reserve increased the interest rates, as a result of which, a huge hike in home-loan installments and rents can be witnessed.

In October, the average rent of a two-bedroom apartment was 1.49 lakh rupees, which is 9.2% more than the last year. Jeff Tucker, Senior Economist, real estate company Zillow, has stated that this is backfiring of the fight against inflation. The company found out that today, the loan installment is 77% more than a year ago on buying a normal house. On 11th November, the US government had released new inflation figures, which have revealed that during the last month, housing comprised more than half the share of increasing rates.

As compared to the last year, this year, inflation has been more than 7% every month. Such a level of inflation in the USA was seen back in the year 1980.

Sonakshi Datta
Sonakshi Datta
Journalist who wants to cover the truth which others look the other way from.

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