You need to earn 70% more now than 6 years ago to afford a median US home — but there’s still hope for buyers
Think owning a home is still the American Dream? Well, you now need a six-figure income just to afford the mid-tier of that dream.
According to the latest Realtor.com April Housing Trends Report, the income needed to buy a median-priced home in the U.S. has soared to $114,000 — a staggering 70.1% jump from just $67,000 six years ago.
For context, Americans’ actual median household income was $80,610 in 2023, according to the U.S. Census Bureau.
In other words, most Americans can’t afford most homes on the market. In fact, 57% of households can’t even buy a $300,000 home, according to the National Association of Home Builders (NAHB).
It might be fair to call this situation a crisis. Here’s how we got to this point and what comes next.
A key factor driving the housing crisis is a lack of supply. Property developers across the country have chronically underbuilt homes since the Great Recession of 2008, according to the U.S. Chamber of Commerce. As of 2025, the market faces an estimated shortage of 4.5 million homes.
A lack of supply encourages buyers’ bidding wars, which drive prices up. That’s what we’ve seen over the past six years.
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Unfortunately, there are signs that this crisis could get worse. In April 2025, construction began on 1.36 million new homes, down 1.7% compared to the same time last year, according to the Census Bureau.
The NAHB points to the rise of interest rates as an exacerbatubg factor. High interest rates not only make it more difficult for construction companies to finance projects but for homebuyers to afford mortgages.
However, it’s not all doom-and-gloom for potential buyers. Realtor.com’s report found a silver lining emerging in the market.
According to Realtor’s analysis, some homeowners in certain parts of the country are “meeting buyers in the middle.” In other words, they’re willing to take a price cut on their home listing.
Housing inventory is starting to build in several high-cost markets, including San Diego, San Jose, and Washington, D.C. These cities have also seen sharp increases in the number of homes listed on the market — rising by 70.1%, 67.6%, and 69.3% respectively since last year.
