My niece Sarah turned 28 last month. Graduated college with a nursing degree. Worked her way through school so she wouldn’t have debt. Got a good job at a hospital making decent money. Lived with roommates to save on rent. Did everything the adults in her life told her to do.

She called me last week almost in tears. She’s been trying to buy a house for two years. Still cant afford it.

And heres the thing. Its not her fault. The system is completely broken.

Mortgage rates are at 6.23% according to Freddie Mac. During COVID people were getting loans at 2.5%. Same houses. Same neighborhoods. Except now the monthly payment is like $800 more for the exact same property.

The math that breaks everything: A $300,000 house at 2.75% = ~$1,225/month. That same house today at $450,000 and 6.23% = ~$2,770/month. More than DOUBLE. Same house.

Home prices are up over 50% since 2020. FIFTY PERCENT. Wages didnt go up 50%. Savings didnt go up 50%. Just prices. Because apparently thats how markets work now.

Housing affordability crisis explained

The experts call it the “lock-in effect.” Fannie Mae reports that 69% of homeowners have mortgage rates under 5%. Almost a quarter are under 3%. These people are NEVER selling. Why would they? Give up a 2.5% mortgage to buy something at 6.23%?

So the people who got in early are locked in. And everyone else is locked out. Two Americas.

Fortune reported that even if rates drop, it probably wont be enough to make houses affordable again. The actual real estate industry is admitting that the problem is beyond fixing with normal tools.

My take: The American dream of homeownership is dead for an entire generation. And everyone in charge just shrugs and tells them to wait. Wait for what? Prices to go up another 50%?

Some young people are giving up entirely. A Zillow economist said people are “turning to long-term renting or even co-living models because the idea of owning a home has become so out of reach.” Co-living. Thats fancy talk for having roommates forever.

Sarah’s been looking at condos now instead of houses. Smaller. Older. Further from work. The dream keeps shrinking.

Here’s what really gets me. I bought my house in 2014. Paid $145,000. My mortgage payment is like $900 a month. If I sold that house today and tried to buy it back at current prices? I couldn’t afford my own house.

That’s insane. That’s a broken system.

Sarah asked me what she should do. I didn’t have a good answer. Wait and hope rates drop while prices go up? Buy now with a brutal payment? Keep renting forever? There’s no right choice. Every option sucks.

This is what we built. A housing market that works great for hedge funds and people who already own homes a perfect example of corporations thriving while ordinary people fall behind and works terribly for everyone else.

My niece did everything right. She’s still locked out.

What a country.