Owning a single-family home in the U.S. now requires an average annual income of $107,700, nearly double the income needed in 2019, according to a new report by Oxford Economics.
This increase is attributed to soaring home prices and nearly doubled mortgage rates over the past five years, the New York Post reported.
Housing affordability has plummeted, with only 36% of households able to purchase a home in 2024 compared to 59% in 2019.
The least affordable markets include cities like San Jose, San Francisco, Los Angeles, San Diego, and Honolulu, where fewer than 15% of households can cover housing costs. In contrast, the most affordable cities, such as Cleveland, Detroit, and Oklahoma City, have housing costs ranging from $64,600 to $75,300, making homeownership accessible to about half of local households.
Midwestern and Southern cities like Decatur, Illinois, and Charleston, West Virginia, top the list of most affordable areas, with nearly two-thirds of residents earning enough to purchase a home. Meanwhile, the median U.S. home sale price climbed to $394,000 in June 2024, a 4.4% year-over-year increase, according to Redfin.
The affordability crisis is particularly stark for first-time buyers, with their share dropping to 24% in 2024, the lowest since the National Association of Realtors began tracking the data in 1981.
As housing costs hit record highs, the dream of homeownership is slipping further out of reach for many Americans.