Only 28% of Homes on the Market are Affordable for a Typical Household
- Buying power is down nearly $30,000 nationally since 2019, despite a 15.7% rise in median income
- Higher mortgage rates are costing buyers an extra $7,200 per year in financing for a $400,000 home
AUSTIN, Texas, Aug. 21, 2025 /PRNewswire/ -- In a market defined by higher interest rates and persistent affordability challenges, a new report from Realtor.com® reveals just how far buyers' budgets are being stretched. According to the August 2025 Buying Power Report, only 28.0% of homes on the market were priced within reach of the typical household as the maximum affordable home price for a median-income household in the U.S. has fallen to $298,000. The figure is down nearly $30,000 from $325,000, which is where it sat in 2019.
"Even as incomes grow, higher interest rates have eroded the real-world purchasing power of the typical American household," said Danielle Hale, Chief Economist, Realtor.com®. "This dynamic is forcing many buyers to adjust their expectations, whether that means looking for smaller homes, moving farther out, or delaying the dream of homeownership altogether."
And while wages have risen 15.7% in the same time frame, they haven't kept pace with borrowing costs. With mortgage rates hovering near 6.75% through July, the monthly mortgage payment on a $320,000 fixed-rate loan is $600 higher than it would have been at 2019's average rate. That's an additional $7,200 a year out of the average buyer's pocket, and that payment won't buy what it used to. In 2019 a $320,000 loan would have covered the entire median home price while today it would need to be accompanied by a nearly 28% down payment to buy the typical-listing (priced at $439,450).
Where Buyers Have Been Hit Hardest
Buying power has dropped most dramatically in metros like Milwaukee, Wis., Houston,Texas, Baltimore, Md. New York City, and Kansas City, Mo., all of which have seen declines of 9–10.5% in what the median earner can afford. In Milwaukee, for example, which experienced the highest buying power percentage decrease of 10.5%, the maximum affordable home price fell from $314,000 to $281,000, a $33,000 drop.
While affordability declined, these metros still had a relatively high share of affordable homes—except for New York, where just 13.1% of listings in July were within reach of a median-income household.
Metro | 2019 Max | Share of | 2025 Max | Share of | Difference | Change |
Milwaukee-Waukesha, WI | $314,000 | 58.2 % | $281,000 | 28.3 % | -$33,000 | -10.5 % |
Houston-Pasadena-The | $330,000 | 59.2 % | $299,000 | 32.4 % | -$31,000 | -9.4 % |
Baltimore-Columbia-Towson, MD | $397,000 | 63.1 % | $360,000 | 42.7 % | -$37,000 | -9.3 % |
New York-Newark-Jersey City, | $397,000 | 28.2 % | $360,000 | 13.1 % | -$37,000 | -9.3 % |
Kansas City, MO-KS | $335,000 | 63.5 % | $304,000 | 34.2 % | -$31,000 | -9.3 % |
Where Has Buying Power Grown the Most?
Only six of the 50 largest U.S. metros saw buying power increase since 2019. Leading the way was Cleveland, Ohio, where strong wage gains helped boost the affordable home price from $249,000 to $260,000 (+4.4%). Also, an impressive 50% of inventory on the market in Cleveland in July was affordable to median-earning households.
Pandemic boomtowns like Phoenix, Ariz., Tampa, Fla., and Austin have seen a slight boost in buying power thanks to rising wages. But even with that progress, rapid home price growth has outpaced income gains, leaving few truly affordable options. In fact, in all six markets where buying power has improved, the share of homes affordable to median-income buyers is still lower than it was in 2019.
Metro | 2019 Max | Share of | 2025 Max | Share of | Difference | Change |
Cleveland, OH | $249,000 | 65.4 % | $260,000 | 50.0 % | $11,000 | 4.4 % |
Phoenix-Mesa-Chandler, AZ | $324,000 | 50.0 % | $332,000 | 13.7 % | $8,000 | 2.5 % |
Richmond, VA | $326,000 | 56.8 % | $331,000 | 24.8 % | $5,000 | 1.5 % |
Indianapolis-Carmel-Greenwood, | $298,000 | 64.3 % | $302,000 | 43.4 % | $4,000 | 1.3 % |
Tampa-St. Petersburg- | $276,000 | 54.0 % | $277,000 | 21.6 % | $1,000 | 0.4 % |
Austin-Round Rock-San Marcos, | $387,000 | 57.7 % | $388,000 | 31.5 % | $1,000 | 0.3 % |
The Impact of Shrinking Buying Power and What Would Alleviate It?
Shrinking buying power isn't just a matter of dollars and cents, it's reshaping buyer behavior. As affordability declines, many buyers are competing more aggressively for lower-priced homes, turning to rentals when homeownership feels out of reach, or delaying their plans altogether—especially younger households without existing equity. This shift in demand also affects sellers, who may need to adjust pricing expectations or prepare for a longer time on market. Looking ahead, restoring lost buying power will likely depend on a combination of modestly lower mortgage rates, stronger wage growth, and most critically, a boost in housing supply, particularly in the affordable segment. Until those conditions improve, today's buyers will need to remain both strategic and flexible in navigating the market.
50 Largest Metros Data Changes in Buying Power Since 2019 (Alphabetical)
Geography | Median | 2019 Max | Share of | Median | 2025 Max | Share of | Difference | Change |
USA | $68,073 | $325,000 | 55.7 % | $78,770 | $298,000 | 28.0 % | -$27,000 | -8.3 % |
Atlanta-Sandy Springs-Roswell, | $71,742 | $343,000 | 60.7 % | $87,947 | $333,000 | 31.4 % | -$10,000 | -2.9 % |
Austin-Round Rock-San | $80,954 | $387,000 | 57.7 % | $102,412 | $388,000 | 31.5 % | $1,000 | 0.3 % |
Baltimore-Columbia-Towson, | $83,160 | $397,000 | 63.1 % | $95,068 | $360,000 | 42.7 % | -$37,000 | -9.3 % |
Birmingham, AL | $58,366 | $279,000 | 58.2 % | $71,644 | $271,000 | 41.3 % | -$8,000 | -2.9 % |
Boston-Cambridge-Newton, | $94,430 | $451,000 | 38.1 % | $109,295 | $414,000 | 9.6 % | -$37,000 | -8.2 % |
Buffalo-Cheektowaga, NY | $60,105 | $287,000 | 70.1 % | $71,055 | $269,000 | 47.1 % | -$18,000 | -6.3 % |
Charlotte-Concord-Gastonia, | $66,399 | $317,000 | 50.7 % | $81,514 | $309,000 | 20.8 % | -$8,000 | -2.5 % |
Chicago-Naperville-Elgin, IL-IN | $75,379 | $360,000 | 62.3 % | $86,627 | $328,000 | 41.2 % | -$32,000 | -8.9 % |
Cincinnati, OH-KY-IN | $66,825 | $319,000 | 68.9 % | $80,109 | $303,000 | 43.1 % | -$16,000 | -5.0 % |
Cleveland, OH | 52,178 | $249,000 | 65.4 % | $68,695 | $260,000 | 49.9 % | $11,000 | 4.4 % |
Columbus, OH | $67,207 | $321,000 | 64.6 % | $80,469 | $305,000 | 34.8 % | -$16,000 | -5.0 % |
Dallas-Fort Worth-Arlington, TX | $72,265 | $345,000 | 55.6 % | $88,783 | $336,000 | 30.1 % | -$9,000 | -2.6 % |
Denver-Aurora-Centennial, CO | $85,641 | $409,000 | 37.9 % | $106,833 | $405,000 | 19.2 % | -$4,000 | -1.0 % |
Detroit-Warren-Dearborn, MI | $63,474 | $303,000 | 63.5 % | $72,493 | $275,000 | 48.8 % | -$28,000 | -9.2 % |
Grand Rapids-Wyoming- | $65,739 | $314,000 | 63.5 % | $82,065 | $311,000 | 31.9 % | -$3,000 | -1.0 % |
Hartford-West Hartford-East | $77,005 | $368,000 | 68.6 % | $94,838 | $359,000 | 36.8 % | -$9,000 | -2.4 % |
Houston-Pasadena-The | $69,193 | $330,000 | 59.2 % | $78,845 | $299,000 | 32.4 % | -$31,000 | -9.4 % |
Indianapolis-Carmel- | $62,502 | $298,000 | 64.3 % | $79,724 | $302,000 | 43.4 % | $4,000 | 1.3 % |
Jacksonville, FL | $65,880 | $315,000 | 58.4 % | $81,893 | $310,000 | 32.1 % | -$5,000 | -1.6 % |
Kansas City, MO-KS | $70,215 | $335,000 | 63.5 % | $80,127 | $304,000 | 34.2 % | -$31,000 | -9.3 % |
Las Vegas-Henderson-North | $62,107 | $297,000 | 43.8 % | $72,504 | $275,000 | 12.8 % | -$22,000 | -7.4 % |
Los Angeles-Long Beach- | $77,774 | $371,000 | 10.3 % | $91,380 | $346,000 | 1.6 % | -$25,000 | -6.7 % |
Louisville/Jefferson County, KY- | $61,172 | $292,000 | 64.7 % | $72,566 | $275,000 | 40.9 % | -$17,000 | -5.8 % |
Memphis, TN-MS-AR | $54,859 | $262,000 | 61.4 % | $66,946 | $254,000 | 35.3 % | -$8,000 | -3.1 % |
Miami-Fort Lauderdale-West | $60,141 | $287,000 | 36.9 % | $74,274 | $281,000 | 23.4 % | -$6,000 | -2.1 % |
Milwaukee-Waukesha, WI | $65,845 | $314,000 | 58.2 % | $74,222 | $281,000 | 28.3 % | -$33,000 | -10.5 % |
Minneapolis-St. Paul- | $83,698 | $400,000 | 67.3 % | $96,855 | $367,000 | 37.0 % | -$33,000 | -8.3 % |
Nashville-Davidson-- | $70,262 | $335,000 | 46.4 % | $85,166 | $323,000 | 11.8 % | -$12,000 | -3.6 % |
New York-Newark-Jersey City, | $83,160 | $397,000 | 28.2 % | $94,960 | $360,000 | 13.1 % | -$37,000 | -9.3 % |
Oklahoma City, OK | $60,605 | $289,000 | 62.9 % | $71,503 | $271,000 | 40.5 % | -$18,000 | -6.2 % |
Orlando-Kissimmee-Sanford, | $61,876 | $295,000 | 51.3 % | $74,895 | $284,000 | 18.2 % | -$11,000 | -3.7 % |
Philadelphia-Camden- | $74,533 | $356,000 | 65.0 % | $88,483 | $335,000 | 38.7 % | -$21,000 | -5.9 % |
Phoenix-Mesa-Chandler, AZ | $67,896 | $324,000 | 50.0 % | $87,718 | $332,000 | 13.7 % | $8,000 | 2.5 % |
Pittsburgh, PA | $62,638 | $299,000 | 71.6 % | $72,935 | $276,000 | 54.6 % | -$23,000 | -7.7 % |
Portland-Vancouver-Hillsboro, | $78,439 | $375,000 | 30.1 % | $94,748 | $359,000 | 11.4 % | -$16,000 | -4.3 % |
Providence-Warwick, RI-MA | $70,967 | $339,000 | 49.5 % | $85,421 | $324,000 | 8.4 % | -$15,000 | -4.4 % |
Raleigh-Cary, NC | $80,096 | $382,000 | 60.3 % | $98,138 | $372,000 | 29.7 % | -$10,000 | -2.6 % |
Richmond, VA | $68,324 | $326,000 | 56.8 % | $87,394 | $331,000 | 24.8 % | $5,000 | 1.5 % |
Riverside-San Bernardino- | $70,954 | $339,000 | 36.1 % | $86,146 | $326,000 | 8.5 % | -$13,000 | -3.8 % |
Sacramento-Roseville-Folsom, | $76,706 | $366,000 | 29.6 % | $93,641 | $355,000 | 8.0 % | -$11,000 | -3.0 % |
San Antonio-New Braunfels, TX | $62,355 | $298,000 | 58.5 % | $73,281 | $278,000 | 34.2 % | -$20,000 | -6.7 % |
San Diego-Chula Vista- | $83,985 | $401,000 | 14.0 % | $103,066 | $390,000 | 3.2 % | -$11,000 | -2.7 % |
San Francisco-Oakland- | $114,696 | $548,000 | 18.4 % | $133,542 | $506,000 | 11.9 % | -$42,000 | -7.7 % |
San Jose-Sunnyvale-Santa | $130,865 | $625,000 | 9.9 % | $156,664 | $593,000 | 6.3 % | -$32,000 | -5.1 % |
Seattle-Tacoma-Bellevue, WA | $94,027 | $449,000 | 33.6 % | $113,456 | $430,000 | 11.0 % | -$19,000 | -4.2 % |
St. Louis, MO-IL | $66,417 | $317,000 | 72.9 % | $79,869 | $303,000 | 52.2 % | -$14,000 | -4.4 % |
Tampa-St. Petersburg- | $57,906 | $276,000 | 54.0 % | $73,079 | $277,000 | 21.6 % | $1,000 | 0.4 % |
Tucson, AZ | $56,169 | $268,000 | 53.7 % | $67,909 | $257,000 | 11.7 % | -$11,000 | -4.1 % |
Virginia Beach-Chesapeake- | $69,329 | $331,000 | 60.7 % | $80,312 | $304,000 | 26.0 % | -$27,000 | -8.2 % |
Washington-Arlington- | $105,659 | $504,000 | 58.7 % | $123,209 | $467,000 | 31.8 % | -$37,000 | -7.3 % |
Methodology:
2019 income data from 1-year ACS, 2025 income data from Claritas and is based on the latest census income estimates. Housing payments include principal and interest only, assuming 20% down payment, a 4% mortgage interest rate for 2019 and 6.74% mortgage rate for 2025. Maximum affordable housing payment calculated using the 30% affordability rule of thumb.
About Realtor.com®
Realtor.com® pioneered online real estate and has been at the forefront for over 25 years, connecting buyers, sellers, and renters with trusted insights, professional guidance and powerful tools to help them find their perfect home. Recognized as the No. 1 site trusted by real estate professionals, Realtor.com® is a valued partner, delivering consumer connections and a robust suite of marketing tools to support business growth. Realtor.com® is operated by News Corp [Nasdaq: NWS, NWSA] [ASX: NWS, NWSLV] subsidiary Move, Inc.
Media contact: Asees Singh, [email protected]
SOURCE Realtor.com
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