There are two ways to get back to the level of home affordability Americans had for much of the last decade, according to Realtor.com. Neither looks realistic anytime soon.
In 2019, the mortgage payment for a median-priced home took up about 21% of median household income. Today, it accounts for more than 30%, reflecting sharply higher home prices and mortgage rates that have nearly doubled since January 2022, according to a recent analysis from the real estate listings platform.
Barring a sharp drop in home prices, Realtor.com calculates that getting monthly payments back to 2019 levels would require one of two things:
Neither option appears likely in the near term. Real median household income has risen only about 17% over the past 20 years, according to the U.S. Census Bureau. Mortgage rates are more likely to ease from their current 30-year fixed rate, though most forecasts still have them hovering near 6% through 2026.
Even at that level, affordability gains may be limited. The National Association of Realtors projects that home prices will rise about 4% in 2026 as renewed demand runs up against stubborn supply shortages.
