U.S. home affordability slips for fifth straight month as prices and mortgage rates rise
Rising borrowing costs and higher home prices are making it harder for U.S. buyers to qualify for a mortgage in June. The income needed to finance a median-priced single-family home reaches $109,152, even though affordability remains slightly better than a year earlier.
Highlights
- U.S. housing affordability index fell for the fifth straight month in June as the median home price reached $446,400 and qualifying income hit $109,152.
- June's $440,600 median existing home price marks a record, but its 1.8% annual growth is sharply below pandemic-era double-digit increases.
- The 21st Century ROAD to Housing Act, signed July 11, aims to expand housing supply but relief for affordability constraints is not expected in the near term.
June housing costs tighten buyer budgets
As reported by CNBC, citing the National Association of Realtors, its latest housing affordability index shows affordability slipping in June for the fifth consecutive month. The group says the income needed to qualify for a mortgage on a median-priced single-family home valued at $446,400 is $109,152.The decline extends a trend that starts in January, when the median home price is $398,200, the average mortgage rate is 6.19% and the qualifying income is $93,552. NAR also says the median price of an existing home of any type reaches a record $440,600 in June.
Despite the monthly deterioration, affordability is still slightly improved from June 2025 because income growth outpaces home price appreciation and mortgage rates are modestly lower than a year earlier.
Price growth slows as policy impact may take time
Slight improvements in affordability are expected as the market moves beyond the busy spring and summer buying season. While the June median price sets an all-time high, the annual increase is 1.8%, well below the double-digit gains recorded during the pandemic housing boom.Experts say homebuyers may need to wait before seeing benefits from the bipartisan 21st Century ROAD to Housing Act, signed into law on July 11. The measure is intended to increase housing supply and address affordability, but any relief is not expected immediately.
Our earlier coverage of multifamily permit growth in midsize U.S. cities explained how faster apartment construction could gradually expand rental supply and bring modest rent relief, with Columbus highlighted as a key outlier. We also noted that, despite localized easing in some markets, the broader affordability picture remains strained as lower-cost rental inventory has shrunk and many households are still cost-burdened.
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