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Home Affordability In ‘Holding Pattern’ As Housing Costs Outpace Wages

Mar 31, 2025
ATTOM reports housing affordability remains elusive
Housing expenses consumed one-third of the average U.S. national wage in the first quarter of 2025, according to a report from ATTOM.

With spring homebuying season just about underway, experts caution prices pressures could escalate

Homeownership remains a financial strain for average Americans, with major housing expenses consuming one-third of the average national wage in the first quarter of 2025, according to ATTOM’s latest U.S. Home Affordability Report. 

Despite a slight dip in median home prices to $351,000, affordability remains near historic lows across most of the country, reported ATTOM, a curator of land, property data, and real estate analytics. 

The report found that 97% of counties analyzed were less affordable than their historical averages, continuing a trend that has plagued the housing market for the past three years. The burden is particularly evident in major markets like Los Angeles, Miami-Dade, and Phoenix, where mortgage rates hovering around 7% are exacerbating the issue.

“Home affordability is in a ‘holding pattern’ this quarter — financially stressful for average wage earners but not changing much,” Rob Barber, CEO of ATTOM, stated in a release. “With the peak buying season ahead, prices could rise further, worsening affordability.”

ATTOM's U.S. Home Affordability Index analyzed median home prices from publicly recorded sales deed data the company collected as well as average wage data from the U.S. Bureau of Labor Statistics in 574 U.S. counties with a combined population of 253 million during the first quarter of 2025. 

While the national median home price fell slightly about 1% from the previous quarter, it remains 5.2% higher than a year ago. Meanwhile, wages have struggled to keep up, contributing to a widening gap between home prices and incomes.

Among counties with populations over one million, Suffolk County, N.Y., and Nassau County, N.Y., saw some of the sharpest price increases, jumping 11.9% and 9.4%, respectively. Conversely, Alameda County, Calif., and Fulton County, Ga., experienced respective notable declines of 11.2% and 4.2%.

Truly Unaffordable

Affordability challenges remain most pronounced along the Northeast and West Coasts. In Brooklyn, N.Y., the average homeowner must allocate a stratospheric 109.5% of their annual income to cover mortgage payments, property taxes, and insurance. Similarly extraordinary burdens exist in Maui County, Hawaii (101.5%) and San Luis Obispo County, Calif. (100.1%).

However, more affordable housing opportunities persist in areas like Wayne County, Mich., and Allegheny County, Pa., where average ownership costs account for less than 20% of the average wage.

Nationwide, the typical annual income needed to afford a median-priced home reached $86,611 — nearly 16% above the average national wage of $74,698. That means over half of the analyzed counties require incomes exceeding $75,000 for a typical home purchase, putting ownership further out of reach for many Americans.

With the spring homebuying season just about underway, experts caution that price pressures could escalate further. While mortgage rates may fluctuate, the persistent imbalance between wages and housing costs suggests affordability will remain a major challenge in 2025.

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Published
Mar 31, 2025
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